She suspected that this transaction would be accretive to HPT shareholders, Business & Finance Assignment Homework Help
summarize the case study and answer these qestions
She suspected that this transaction would be accretive to HPT shareholders, but if so, how much
value would it create? In addition to any value created from earnings accretion, HPT shareholders
received shares of TA that were currently worth $2.90 for every share of HPT they held. She
wondered: Was all this value being created out of thin air?
She also wanted to better understand the rationale for certain aspects of the transaction. For
instance, why did HPT put $213 million of cash on TA’s balance sheet in conjunction with the spinoff?
Were HPT’s incentives to allow TA to thrive, or merely to survive?