Greenfield investment


Greenfield investment

A Greenfield Investment is the investment in a manufacturing, office, or other physical company-related structure or group of structures in an area where no previous facilities exist. [http://glossary.reuters.com/index.php/Greenfield_Investment] [http://financial-dictionary.thefreedictionary.com/Green+Field+Investment] The name comes from the idea of building a facility literally on a "green" field, such as farmland or a forest. Over time the term has become more metaphoric.

Greenfield Investing is usually offered as an alternative to another form of investment, such as mergers and acquisitions, joint ventures, or licensing agreements. Greenfield Investing is often mentioned in the context of Foreign Direct Investment

A related term to Greenfield Investment which is becoming popular is Brownfield Investment, where a site previously used for a "dirty" business purpose, such as a steel mill or oil refinery, is cleaned up and used for a less polluting purpose, such as commercial office space or a residential area.

See also

* Greenfield land
* Greenfield project
* Greenfield agreement

External links

* [http://ideas.repec.org/p/tcd/tcduet/981.html Analysing Foreign Market Entry: The Choice between Greenfield Investment and Acquisitions]
* [http://www.isae.it/Working_Papers/basile27.pdf Acquisition versus Greenfield Investment: The Location of Foreign Manufacturers in Italy]


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