Question: Punxsutawney Taxidermy Inc PTI operates a chain of taxidermy shops

Punxsutawney Taxidermy Inc. (PTI) operates a chain of taxidermy shops across the Midwest, with a handful of locations in the South. A rival firm, Heads Up Corp., has a few Midwestern locations, but most of its shops are located in the South. PTI and Heads Up decide to consolidate their operations by trading ownership of a few locations. PTI will acquire four Heads Up locations in the Midwest, and in exchange will relinquish control of its Southern locations. No cash changes hands up front. Does this mean that an analyst working for either company can evaluate the merits of this deal by assuming that the project has no initial cash outlay? Explain.

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  • CreatedMarch 26, 2015
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