The economic growth being experienced in different countries for both the developed and developing nations create market gaps and market opportunities for many firms to spread to other countries in an attempt to fill the market gap or to take advantage of the growing global economy. As a result, most of the company has spread to other countries leading to international companies. However, it is important to note that the spread of a company to other countries is significantly shaped by some factors such as how the company enters into the international market. That is through procedures such as amalgamation and acquisitions, the trading laws and regulations between the countries, trading tariffs, as well as other factors such as culture and a countries political stability. Despite the challenges it is also important to mention that operating in the international market provide the company with significant advantages such as expanding its market shares, spreading its risks, as well as enabling the company to develop products that are culturally diversified which in turn helps in the capturing global market. As a result of the possible positive and adverse effects that a company can face while spreading to the international market, this paper seeks to gather adequate information regarding this topic.
Company Operating outside EU
As the head of a company that is based in the US would not prefer to spread the company into a nation that is in the European Union, but rather I would prefer to spread into countries that are not in the European Union. Firstly, in the recent past, Europe which is an important country for the European nations have been suffering significant financial crisis which in turn will adversely affect a company that intends to spread to any nation among the twenty-eight nations in the European Union. Literature and statistics indicate that since 2009, Europe has been experiencing financial problems which revolve around huge debts which have already started affecting the country's economic activities, and the adverse effects are expected to continue even after the country manages to settle the debts ( Godby,2013) . As a result, spreading to the European nations poses challenges as the company might be affected by the current financial crisis being experienced in Europe being the headquarters of the European Union. Additionally, since the US is not a member of the European Union, spreading the company to European Union nations will pose some challenges for the company such as suffering from increased trade tariffs or none-trade tariff restrictions ( Godby,2013) . As a result, increasing the company's cost of operation leading to high cost of goods and services provided by the company which will in turn directly and adversely affect the total sales posting a loss challenge for the company ( Bourdet et al., 2007) . Additionally, since the US is not a member of the European Union, the company is likely to pay relatively high prices of border crossing, creditors as well as suffering from restricted regulations that govern the reorganization of companies in the European Union market for the none- members countries. As a result, the process of spreading into the European Union market through the acquisition process might be quite expensive for the company which in turn will affect its operations as well as financial resources leading to losses or inability to carry on the business leading to the decline of the company.
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Advantage of not Spreading to the European Union
There are numerous advantages that the company is likely to benefit from as a result of acquiring a company that is not within the European Union. Firstly, the company is not likely to be affected by the financial crisis that is being experienced in Europe. As already indicated Europe has been suffering from high debts rates have had significantly affected its economic as well as political activities ( Cohen& Oxford University Press, 2007) . Additionally, the adverse economic experience in Europe is also likely to affect members of the European Union because the countries headquarters and major operations are based in Europe. Additionally, the European Union have also been faced with the challenges of countries that withdraw from the membership which is also likely to impact on the other member countries. In the recent past, Britain withdrew its membership from the European Union due to the financial crisis that the nations were facing, as a result of the withdrawal, the terms and regulations that govern the union is likely to change which will, in turn, alter how new companies will operate the European Union states.
Also, the company is not likely to suffer from the policies that govern the European Union. Laws and policies that govern how the different members interact regarding politics and economic activities govern the European Union. For an already existing company in the US to invest in the EU, it has to abide by the laws and regulations of the EU. One of the laws is the fact that the company profit will not be interfered with in an attempt to equalize the EU nations ( Cohen & Oxford University Press, 2007) . One of the EU policies is that which requires countries that are economically stable to support the developing countries in the membership, which in turn leads to sharing of profits which in turn influences the total annual profit that a company makes. Lastly, due to the economic, political and military dominance of the US on other nations, a US company is likely to be successful in other countries than when compared with venturing into the European Union which is a relatively large market dominated by other powerful nations such as Britain which might pose a threat to the US in terms of political, and economic superiority ( Bourdet et al., 2007) .
Disadvantages of Investing in a Nation outside EU
On the other hand, failing to acquire a company from the European Union also places countries as disadvantages. Firstly, the EU provide a ready market for its members, therefore, failing to acquire a company in the EU will lead to loss of the already existing and large market ( Vance, 2009) . Secondly, spreading to other countries besides the EU country also poses cultural differences, which in turn affects a company's day to day activities. Also, acquiring companies from other regions might also lead to language barrier which might in turn significantly impact negatively on the company’s operations. Lastly, currency differences with other nations might also pose a challenge for an already existing business, which might hinder the company from benefiting maximally from the international market due to currency differences ( Vance, 2009) .
Advantages of Acquiring in an EU nation
One of the advantages of spreading to the international market through nations in the EU is the fact that it offers the largest market. Literature indicates that EU offers approximately 500 million customers for its members, which in turn implies a large market for a company that acquires another company within the EU ( Vance, 2009) . Secondly, for a US company to invest in an EU nation, it is likely to benefit from the high currency in Europe as well as same currency with other members of the EU, which in turn serves as an advantage. Additionally, most of the EU countries US English, which means that a company that spreads within the EU is not likely to suffer challenges that arise from language barriers. Additionally, the company is likely to benefit from anticompetitive practices, which in turn helps the company to grow and develop. Lastly, a company operating in the EU enjoys other benefits such as removal of trade barriers, enjoying business efficiency as well as low cost of business operations ( Cohen & Oxford University Press, 2007) .
Disadvantages of Operating in EU
On the other hand, operating in an EU nation is quite demanding due to some factors. Firstly, it is costly to be a member of the EU this, in turn, hinders a company from investing in EU nations in an attempt to evade the additional cost. Secondly, The company is likely to suffer from loss of control for its company due to EU policies that interfere with the EU nations forms of government ( Cohen & Oxford University Press, 2007) . Lastly, while serving the EU market, it is difficult for the company effectively meet the different countries languages as well as a diverse culture which in turn places a language and cultural barrier for such acquired companies.
Multinational Corporation Investing in Other Countries
The first reason as to why a multinational corporation invests in another country is due to factors such as cheap labor. The availability of cheap labor can attract a company to invest in another nation. Secondly is the purpose of growth, when a company feels that it have satisfied its domestic customers the need to spread to customs in other countries arise which in turn motivate the company to invest in another state ( Bjarnason, 2010) . Thirdly, in an attempt to bypass protection in the importing nations, for example, after the EU introduced external tariffs against its outsiders the multinational companies developed subsidiaries to bypass this restriction. Lastly, is for a multinational company to cut its operational cost such as transportation cost of goods from one nation to the other as well as cutting down another cost such as cooperate tax as well as reducing competition in the domestic market ( Bjarnason, 2010) .
Financial Institutions Providing Finances to Markets outside the Country
Firstly, a financial institutional is motivated to offer credit to countries other than their operational countries in an attempt to diversify their credits ( Beltratti& Stulz, 2012) , Which in turn reduces the risks of operation in a single state economy. Secondly, the financial institutions hope to benefit from the high-interest rates on funds invested in other financial markets besides the home market. Lastly, the financial institutions are motivated to create other nations financial markets in an attempt to gain from the exchange rates from one currency to the other ( Beltratti & Stulz, 2012) .
Conclusively, the company should not spread and acquire a company in a nation that is in the European Union. The decision results from the fact that the company is likely to be adversely affected by the current increasing debt rate in Europe, which in turn are affecting the economic as well as political activities of the nation, as well as those in the European Union. In addition to this, the company is not likely to be affected by the European Union policies, which adversely affect other countries, which are non-members. On the other hand, the company is likely to lack the large market, which is always provided by the European Union market, which is one and the major challenge of operating in countries that are not part of the European Union. In matters regarding financial institutions providing credit support to companies out of their countries, have been viewed as one of the strategies for such company to earn a large amount of interest as well as to spread the risk of investing in one state.
References
Beltratti, A., & Stulz, R. M. (2012). The credit crisis around the globe: Why did some banks perform better?. Journal of Financial Economics , 105 (1), 1-17.
Bjarnason, M. (2010). The political economy of joining the European Union: Iceland's position at the beginning of the 21st century . Amsterdam: Amsterdam University Press.
Bourdet, Y., Gullstrand, J., & Olofsdotter, K. (2007). The European Union and developing countries: Trade, aid and growth in an integrating world . Cheltenham, UK: E. Elgar Pub.
Cohen, S. D., & Oxford University Press. (2007). Multinational corporations and foreign direct investment: Avoiding simplicity, embracing complexity . Oxford: Oxford University Press.
Godby, R. (2013). European Financial Crisis: Debt, Growth, and Economic Policy . Business Expert Press.
Vance, D. E. (2009). Corporate restructuring: from cause analysis to execution . Berlin, Springer.
