Originally Posted by Lyme
Of course that isn't how that works. They take out loans for purchases, etc, with the the intention that the improvements will offset the repayment costs. However that being said, most companies with cash in had would rather use that, rather than taking out a loan.
No, They wouldn't... A company looks more profitable when it has more money onhand, the debt of loans doesn't affect the company unless they don't have profit coming in. Sony even with its losses still is a profitable company, banks are happy to loan them money because they know Sony will pay it back and its interest, why do you think Sony got an exteremly low interest rate on their huge loan... banks were competing with them. To Sony its basically free money for them to invest into new ventures.