Marriot Corporation

Case Marriot Corporation The Key Question: Dose the Project carry a good project for Marriott Corporation? Suggestion: Yes, the brain of dividing MC into two companies that separate out property ownerships from go withs Services Operation is cost effective and harbor added (exhibit 1), thus should be recommended to the board of MC. As, the plan is launched by distributing equal shares of special stock dividends to MCs original shareholders, MCs shareholders would be tax-exempted for these special dividends that they received as the same time company has benefiting from lower WACC and higher dividend payout (Exhibit 1). Additionally, the split dodging increases MCs opportunity to raise farm animals at the lower cost in the uppercase markets through Marriott external Inc. By splitting out MII, MC is expecting to see that MII with a higher time interest earned of 10.4 and better financial structure (higher current ratio and lower debt to equity ratio) would be rated as high quality by S&P and Moodys in the market (e.g. Aa for Moodys and AA for S&P). As a result, MII could raise capital/ gunstock easier and at lower rate than MC (assume the revolving loan in exhibit 1 can lower by 1%).

This rating improvement would also resolve MCs current constraint and limitation on raising funds in the capital market. According to the plan, the new raised fund would be used to expand companys hotel military control by purchasing assets of competitors in financial difficulty. However, we dont think this business plan with expansion would be accredited by the most of creditors without a proper message to the capital market. Because most of original creditors of MCs bonds were institutional holders who had been suffered from make of Junk Bond and Real Estate Market and business leader also be forced to sell their holdings on MCs bond at an extreme low wrong at the time when MCs plan is implement (MCs bond would be downgraded to non-investment grade due to exasperate financial... If you want to get a full essay, order it on our website: Orderessay

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