Marriott: Frankfurt and Dusseldorf

A project developer for Marriott must determine the economic attractiveness of acquiring two hotels in Germany. Strong strategic issues argue in favor of making the acquisitions. Students are given a completed discounted-cash-flow analysis that shows a negative net present value (NPV) for the acquisitions. The tasks for the students are to (1) test the sensitivity of NPV to changes in assumptions and (2) develop alternative terms by which Marriott might acquire the hotels. A student Lotus worksheet file is available on computer diskette for use with this case. A project developer for Marriott must determine the economic attractiveness of acquiring two hotels in Germany. Strong strategic issues argue in favor of making the acquisitions. Students are given a completed discounted-cash-flow analysis that shows a negative net present value (NPV) for the acquisitions. The tasks for the students are to (1) test the sensitivity of NPV to changes in assumptions and (2) develop alternative terms by which Marriott might acquire the hotels. A student Lotus worksheet file is available on computer diskette for use with this case. Excerpt UVA-F-0928 Rev. Jul. 3, 2012 MARRIOTT: FRANKFURT AND DUSSELDORF “Frankfurt ist die finanzielle Drehscheibe in Deutschland . . . die wichtigste Stadt in Europa nach 1992.” “Die Internationale Automobile Show wird dieses Jahr wohl wieder alle Besucherrekorde brechen.” “Jetzt hat die Deutsche Bank schon Banca d'America in Italien, ich wuesste gerne mal gerne wann die die restlichen Banken in Europa auch noch ueberhehmen!” . . .