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he company is currently considering the acquisition of Whitman Select Brands fro

ID: 2711539 • Letter: H

Question

he company is currently considering the acquisition of Whitman Select Brands from Whitman Enterprises. Joe Whitman, the owner and founder of Whitman Enterprises, is amenable to the idea of selling the international foods and beverages division of the business to General Mills. In addition to this division, Whitman Enterprises, has three other divisions: they manage a small chain of hotels in the New England states; they operate a regional transportation firm; and they own a real estate and insurance brokerage business. The revenues for the four divisions are as follows:
• International foods and beverages: $155 million
• Hotel management: $93 million
• Transportation and shipping: $82 million
• Real estate and insurance brokerage: $30 million

What is the Herfindahl Index (HI) for Whitman Enterprises before the sale of the foods and beverages division to General Mills?

Explanation / Answer

he company is currently considering the acquisition of Whitman Select Brands fro