尉卧活份蜀尚上孝 国际财务管理 综合案例 295-047 Tiffany&Co.一1993 independent retailer of Tiffany products,but would still receive fees equaling 27%of net retail sales in compensation for providing boutique facilities,sales staff,collection of receivables,and security for store inventory. With greater control over retail sales in its Japanese operations,Tiffany looked forward to long-run improvement in its performance in Japan despite continuing weak local economic conditions.However,increased sales and profits were not the only changes that Tiffany could anticipate as a result of the new agreement.Tiffany now faced the risk of foreign currency fluctuations previously borne by Mitsukoshi.Past history warned Tiffany that the yen/dollar exchange rate could be quite volatile on a year-to-year,and even month-to-month,basis.Exhibit 6 illustrates the significant strengthening of the yen against the dollar during the ten years ending in 1993.While a continuation of this strengthening would enhance the dollar value of Tiffany's yen- denominated cash inflows,there was the distinct possibility that the yen might eventually become overvalued and crash suddenly,just as the U.S.dollar did in 1985.Indeed,there was some evidence that the yen was overvalued against the dollar in 1993(see Exhibit 7). Hedging to Manage Foreign Exchange Risk The possibility of sharp,unexpected movements in the yen/dollar exchange rate had prompted Tiffany's management to study the desirability of engaging in a program to manage exchange-rate risk.To reduce exchange-rate risk on its yen cash flows,Tiffany had two basic alternatives available to it.One was to enter into forward agreements to sell yen for dollars at a predetermined price in the future.The other was to purchase a yen put option.The terms at which Tiffany could purchase forward contracts and put options,along with other financial market data,are shown in Exhibit 8. Before committing Tiffany to a hedging program,management wanted to be sure it understood what the potential risks and rewards were for each of these so-called "derivative" instruments.Perhaps more importantly,it was essential to determine whether or not a risk management program was appropriate for Tiffany,what its objectives should be,and how much,if any,exposure should be covered. $52.5 million of inventory held in Mitsukoshi boutiques was actually repurchased during the month of July 1993 (Mitsukoshi agreed to accept a deferred payment on $25 million of this repurchased boutique inventory,which was to be repaid in yen on a quarterly basis with interest of 6%per annum over the next 4 1/2 years) Approximately $62.5 million of Tiffany Co.inventory maintained in Mitsukoshi warehouses will be repurchased throughout the period ending February 28,1998.Payment for this warehouse inventory was to be made in yen forty days following actual receipt of the inventory. 7 Fees were reduced to 5%on certain high-value jewelry items repurchased from Mitsukoshi.Tiffany-Japan would also pay Mitsukoshi incentive fees equal to 5%of the amount by which boutique sales increase year-to year,calculated on a per-boutique basis.In Tokyo,Tiffany boutiques could be established only in Mitsukoshi's stores and Tiffany-brand jewelry could be sold only in such boutiques(though Tiffany-Japan reserved the right to open a single flagship store in Tokyo). -4-国际财务管理 综合案例 - 4 -