On September 23, 2016, Marriott completed the acquisition of the Startwood Hotels & Resorts Worldwide. Marriott paid $13.3 billion for Starwood. Did Marriott overpaid or get a good deal? What needs to happen to make the acquisition worthwhile for Marriott? Let's find out. 

Instruction: 

1. Click the link to read the article about the Extended Stay valuation. (Extended Stay America, Inc.'s (NASDAQ:STAY) Intrinsic Value Is Potentially 33% Above Its Share Price (yahoo.com)). 

2. Use the attached historical cash flows as the base to estimate next 10 years' cash flows (2016-2025) as in the Extended Stay article. Explain how you decide the cash flow and its growth rate. This article (How Marriott plans to save Starwood owners real money | Hotel Management) has good information to help you with the cash flow estimation. (4 points). 

3. Follow Technique 4: 10-year DCF in Chen & Kim (2010) in Week 4 to calculate the present value of Starwood.