Case 14: Chestnut Foods
Suggested questions for discussion:
1. What is the imminent key issue faced by the firm?
What is the key issue of the case?
2. What are your comments on Suchecki’s opinion against the use of multiple hurdle
rates?
3. What are the appropriate hurdle rates for the two segments?
4. Is the Instruments division underperforming, as suggested by Van Muur?
5. How about the Food Products division? Is it creating or destroying value?
6. What are your recommendations on:
a. the appropriate hurdle rate(s) on the two segments?
b. how to respond to Van Muur?