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Executive Summary
Marriott Corporation which is one of the large corporations in managing hotels and other support services such as restaurants and contract services has business goals to remain a significant growth in the company by setting consistent business strategies which are consistent with its goals and developing appropriate investment opportunities in different business sections.
To support Marriott's growth objectives of making profit to the company, preferring employers, and preferring providers, it created four components of Marriott's financial strategy which are:
? Manage rather than own hotels assets
? Invest in projects that increase shareholder value
? Optimize the use of debt in the capital structure
? Repurchase undervalued shares
Due to these potential strategies, they support its company business goals in several ways:
First, by managing rather than owning hotels assets, Marriott can focus on its core competency of hotel management in order to generate a profit without the distraction related with real estate ownership. Marriott also limits partners carefully under long-term management contracts with appropriate management fee conditions and guarantee a portion of the partnership's debt.
Second, investing in projects that increase shareholder value makes Marriott focus on only project which will give potential return to the company by comparing to expected return from discounted cash flow techniques with considerations of other significant conditions such as project risk.
Third, the effort to optimize the use of debt in Marriott's capital structure helps the company maximize reven ...