This 4–day Corporate Finance Applications course is a practical "how to" programme where you will learn:
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Core principals and major applications of corporate finance
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Valuation methodologies and techniques, their uses and abuses
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Cash flow approach vs. accounting approach
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Cost of capital and capital structuring
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M&A: public company takeovers and private company acquisitions
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Leveraged finance and management buy-outs
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Financing alternatives and typical financing structures
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The key characteristics of successful M&As
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How M&A thinking needs to be adjusted in downturn and bear market situations
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M&A valuation techniques
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How to analyse and incorporate synergies within M&A valuation
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Restructuring and divestment as an important part of the CF toolkit, specifically when to divest and the alternative ways of divesting a business.
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What are the essential features of leveraged buyouts and how are they structured?
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What is different about the strategic buyer and the private equity perspective?
- Exit strategies
Who Should Attend
The course will be of value to professionals in the following areas:
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Corporate Financiers
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Financial Analysts, Planners and Corporate Decision makers
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Strategic Planning Executives
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Corporate Treasury Executives
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Accountants Management Consultants
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Lawyers Financial / Investment Analysts
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Investment Managers
Materials
Participants will be provided with a package of materials, including articles and sample documentation from transactions concluded. The workshop will include case studies of actual financings, as well as hands-on exercises, and will give participants the opportunity to demonstrate their understanding through group work and plenary discussions.
Course Background
The course takes you through all the applications of corporate finance from M&A to IPO's to LBO's. However, a key element is that the course demonstrates how the many different applications draw upon a common core framework based upon the principles of financial economics that is reviewed on the first day.
When putting together any corporate finance deal, creating shareholder value is vital. And, as history has taught us, over three quarters of M&A transactions worldwide fail to add value for the acquirer's shareholders and misplaced acquisition programmes often result in financial distress or bankruptcy. All too often incorrect principles, perhaps drawn from the world of accounting may be applied to M&A and other corporate finance transactions. This course identifies clearly the importance of cash and other economic indicators as benchmarks for success to help avoid expensive mistakes.
In summary, corporate finance techniques and structures offer many companies the opportunity for growth, but problems occur when these different financing structures are either not fully understood or the wrong strategy is implemented. The development of this understanding is a key feature of the course with financial economics being valuation key themes throughout. Upon return to your organisation you should be fully prepared to put your learning into practice so as to be equipped to manage in a volatile economic climate.
DAY 1
Overview and core skills
Introduction
Structure of the course
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1 day core skill requirements
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3 days key applications (basic and advanced)
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Review of key applications
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Mergers and Acquisitions (M&A)
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Initial Public Offerings (IPOs)
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Restructuring, turnarounds and workouts
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Leveraged Buy Outs (LBOs), Management Buy Outs (MBOs), Private Equity and Venture Capital
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Emerging markets
Financial analysis
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Creative accounting - capitalisation of interest, research and development and intangibles; brand accounting; lengthening asset lives etc...
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Models for predicting bankruptcy - Z scoring
Project appraisal
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Capital budgeting and project appraisal
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Tools of project appraisal - payback period, return on investment (ROI), net present value (NPV), internal rate of return (IRR)
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Dealing with inflation, taxation, risk and uncertaintyrelevance of the principles of finance - Fisher Effect
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Tools and techniques for analysing and assessing risk and uncertainty
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Capital project proposals - analysis, interpretation and evaluation
Case study: Evaluating a project proposal
Valuation
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Review of traditional measures with contemporary approaches:
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Accounting issues and international accounting standards
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Importance of value driver analysis
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Key issues in valuation†- estimating cash flow, assessing risk, competitive advantage analysis and terminal value estimation
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Developments in valuation†- commercially available valuation models and databases
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Valuation applications: Initial Public Offerings (IPOs), Mergers and Acquisitions (M&A), Buyouts, Restructuring, Asset Management
Case study: Valuing a real-life company
Equity
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Characteristics and types
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Pricing equity and key valuation methods
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Key issues in estimating the cost of equity for alternative applications – M&As, IPOs and emerging markets
Debt
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Importance of gearing/leverage
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Capital structure and debt capacity
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Valuing debt instruments and estimating the cost of debt
Cost of Capital:
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Estimating WACC in emerging markets
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Understanding the limitations of conventional analysis
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Assessing country and equity risk
- Different approaches
Case study: Estimating WACC in an emerging market
DAY 2
Applications (1) - IPOs and M&A Analysis
Overview
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Key requirements of IPO candidates
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Pros and cons of going public
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Understanding the process from start to finish
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Selecting the underwriter
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Selecting the market
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Determining the amount of capital to be raised
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The IPO prospectus
M&As:
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Definition and overview
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The process
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Key success factors
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Estimating synergies - valuing existing businesses on a stand-alone basis and comparing them with the value of the combined businesses
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Importance of understanding different perspectives - control premium, valuation of synergies and perspective
- Valuing the acquisition target with synergies
Case study: Estimating the value of synergies from an acquisition
Due diligence
Making mergers and acquisitions work
DAY 3
Applications (2) -Restructuring
Venture capital restructuring
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Forms of restructuring
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Portfolio
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Management
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Financial
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Pressures to restructure
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Business turbulence
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Debt problems
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Assessing vulnerability- financial ratios, Z scoring and A scoring
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Types of restructuring
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Liquidations
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Divestitures
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Asset sales
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Spin-offs
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Multi-business restructuring
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Understanding the value of a portfolio
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Understanding conglomerate discount
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Assessing the value of the parts
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Applying peer group analysis
- Debt capacity and restructuring
Major restructuring case study
DAY 4
Applications (3) -Structured Finance, Buyouts, Private Equity and Venture Capital
Structured finance, buyouts, venture capital and private equity
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Introduction to and review of structured finance
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Review of types of buyouts
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Management buyouts (MBOs)
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Management buy-ins (MBIs)
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Leveraged buyouts (LBOs)
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Evaluating a buyout candidate
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Financing a buyout candidate
- Key practical issues
Case study: Evaluating a buyout
Major buyout case study
Challenges in emerging markets
Summary and close
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Dr. Roger Mills
Roger Mills is Professor of Fundamental Analysis and Business Valuation at the VU University in Amsterdam, and Emeritus Professor of Finance and Accounting at Henley Business School, University of Reading Management.
Roger has a unique blend of academic and business experience. He has a PhD in Finance, a Masters in Management and a first degree in Psychology, Sociology and Economics. During the professional part of his career Roger trained as a Chartered Management Accountant and he is a Fellow of the Chartered Institute of Management Accountants, the Institute of Chartered Secretaries and Administrators, and the Association of Corporate Treasurers. Roger has written numerous articles and both authored and coauthored many books, the most recent on Financial Statement Analysis and Corporate Finance having been published in 2008. He has consulted to numerous companies and organisations in many countries around the world.
Courses run by this instructor
Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.
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This course has now expired please email us to find out when the course will next be running.