Marriott Essay

Words: 888
Pages: 4
Open Document
1. Project Chariot involves a conflict of interests. Describe this conflict, who it is between, and who stand to gain or lose from this project.

The conflict of interest exists between the shareholders and the bondholders. After Project Chariot is implemented, MII will be of low debt level and HMC will be with high debt. The original bondholders will be tied to risky real estate assets with uncertain appreciation and expected income. Shareholders will gain and bondholders will lose, since splitting the company in two will give shareholders the business upside and bondholders the real-estate downside.

2. In the lecture, we saw a number of different conflicts of interest. Which of these is this project most similar to?

The risk …show more content…
4. In your opinion, should Mr. Marriott recommend this project to the board? Be prepared to defend you opinion on class.

Our group suggest Mr. Marriott recommend this project to the board, mainly on two major reasons.

First, by splitting current Marriott Corporation into MII and HMC, they are able to focus on each of their core business competencies. For MII, without the burden of existing debts from the property side, they are able to leverage their healthy, promising operations to obtain external funds in pursuing better investment opportunities with lower cost of capital. On the other hand, the management is able to concentrate on their service operations to maximize their profits and reduce their cost, without worrying the fluctuation of real estate markets.

On the HMC side, even though the projected net income would be negative, HMC would have stable and guaranteed cash inflows from the MII. The management can focus their attentions on property management efforts and real estate investment opportunities, without worrying about the hotel service complications. As the real estate market has been rebounding from the bottom, HMC could potentially benefit from the recovery.

Secondly, from shareholders’ point of view, this project brings the best long-term profit to them. As the managements and board of directors hold fiduciary duties to the shareholders, it is their responsibility to act on best strategies for the company. Though in the
Show More

Related Documents: Marriott Essay

Marketing for Marriott Essay

MARKETING FOR MARRIOTT INTERNATIONAL Introduction: Marriott is a multi brand company with a Global Portfolio that providing lodging that fit within many market segments. This report will discuss briefly Marriott’s Portfolio of hotels, what they do, briefly examine a number of their key marketing strategies and examine how they are implemented, measured and ask the question does this make them market leaders? The final part of this report will try to identify if there are services or products…

Words 2048 - Pages 9

Marriott paper

Marriott International, Inc. is a global hotel chain with more than 3,000 properties in 68 countries. The corporation operates about 1,000 of its lodging facilities and obtains most if its revenue through leasing agreements and management fees from their property owners (Renner, 2010). The primarily measure performance among comparable properties through RevPAR (Revenue per Available Room) by dividing total room sales by the total room nights available to guest for that specific period (Renner, 2010)…

Words 5391 - Pages 22

Essay on Marketing: Management and Marriott

Tutorial 3 – Marriott Review the case available on the course website. You are required to submit a two page preparation document to your tutor in response to the following 5 questions: 1. Thinking of the resources and capabilities of Marriott throughout the case. Which of these resources do you consider. I may consider well organising rather than other resources. The business should be structured to reach maintain profit based on effective managing skills and developing company, for instance…

Words 637 - Pages 3

Marriott Case Essay

Project Part2 3/18/13 Ratio Analysis by Marriott Group *For each section please refer to the charts at the end Liquidity Ratios Liquidity ratios can be used to measure how fast the company can be liquidated. Generally speaking, a current ratio of 2:1 is preferred by most firms. In the case of Marriott, however, it is 0.52, which is a very low number. It shows that Marriott’s liabilities are far greater than its assets, and therefore it would take a relatively long time to liquidate the company…

Words 1798 - Pages 8

Essay on Marriott Case

In this memorandum we will first discuss the four strategies that Marriott has outlined to achieve its new goal of higher growth. Second, we evaluate the WACC approach that the Company uses to estimate its cost of capital, delineate how to apply the WACC method, and discuss its merits. The Company has outlined four strategies in order to achieve its growth objectives: Manage rather than own hotel assets The first strategy Marriott outlined is consistent with the Company’s objective of more growth…

Words 1039 - Pages 5

Marriott Case Final Essay

Strategy Marriott’s goal is to be the preferred employer, preferred provider, and most profitable company when it comes to their lodging, contract services, and related businesses. Marriott lays a foundation for achieving their goal by creating and following four financial strategies. The first strategy states that Marriott should manage rather than own their hotel assets. By maintaining operating control over the sold assets, Marriot is able to have significant influence over the businesses operations…

Words 1418 - Pages 6

Marriott Rooms Forecasting Essay

Marriott Rooms Forecasting Executive Summary In the case of the Hamilton hotel, Snow needs to make a decision as to if 60 additional rooms reservations should be accepted which could lead to overbooking (Weatherford & Bodily,1990). It is a problem of capacity utilization that is being faced in this particular case where revenue maximization is aimed while minimizing customer dissatisfaction. In this report the case is put forward and various methods have been chosen to come to a sensible conclusion…

Words 2485 - Pages 10

Stock Market and Marriott Corp. Essay

Joseph Taj 812880790 Fin 423 Marriott Corp. Management of Marriott Corp. ran into a dilemma with the company. They had a considerable amount of excess debt capacity and also, projections of future operations and cash flows pointed towards an increase in this capacity for the upcoming year. Marriott corp. identified two general categories of investments, the first being the promotion of growth by expanding current operations and the second was the return of capital to the shareholders by increasing…

Words 436 - Pages 2

Marriott: Taking Care Of People For A Company

take care of people for a company, including employees, customers and other stakeholders. The reason Marriott succeeds in very fierce competition is largely because it take care of its people. Marriott always puts people first. Then because of its caring and thoughtful service, it establish powerful brands in market and take up great market. It is the satisfaction from employees that makes Marriott have the ability to sustain its development in products and service renovation in market. So if I engage…

Words 354 - Pages 2

A Case Study of Marriott International Essay

EXECUTIVE SUMMARY Marriott International envisions itself to be the world’s lodging leader. Its mission is to provide the best possible lodging services experience to customers who vary in backgrounds, language, tradition, religion and cultures all around the world. Marriot is committed to environmental preservation through using environment-friendly technology and engages in social responsibility and community engagement. We value our shareholder’s so we will only take steps that will ensure…

Words 9292 - Pages 38