Master 2020/2021

Mergers, Acquisitions and Restructuring of a Firm

Category 'Best Course for Career Development'

Category 'Best Course for Broadening Horizons and Diversity of Knowledge and Skills'

Type: Elective course (Strategic Corporate Finance)

Area of studies: Finance and Credit

Delivered by: School of Finance

Where: Faculty of Economic Sciences

When: 2 year, 1, 2 module

Mode of studies: offline

Instructors: Svetlana Grigorieva, Ilya Partin, Dmitry Tikhomirov

Master’s programme: Strategic Corporate Finance

Language: English

ECTS credits: 5

Contact hours: 56

Course Syllabus

Abstract

The course examines main motives for M&As, performance of mergers and acquisitions, M&A transactions realization mechanisms, strategic growth and development of the company in the context of M&As, methods of M&A deals structuring, legal, tax and accounting aspects of M&A transactions, and financing transactions (private equity, hedge funds, and LBO structures and valuation). A special attention is paid to particularities of cross-border mergers and acquisitions, alternatives to M&As, restructuring decisions and mechanisms. The course is based on the standard international textbooks on M&A deals, research papers and business cases. Applied aspects of the course are based on recent actual M&A transactions on international and Russian markets. The course consists of lectures along with seminars with lecturers from School of Finance and Lincoln International CIS Holding B.V. The course consists of three logical parts: “Theoretical and practical aspects of M&A and LBO deals” (Topics 1-4), “Challenges of cross-border M&As and peculiarities of deals with private equity funds” (Topics 5-6), “Reorganization and restructuring of companies” (Topic 7).

Learning Objectives

• The purpose of the course is to study the basic theoretical and applied aspects of mergers and acquisitions (M&As) and corporate restructuring.

Expected Learning Outcomes

• Be able to define the motives and mechanisms for the implementation of mergers and acquisitions
• Be able to analyze various operating and financial factors and indicators affecting M&A strategy of a company
• Be able to determine the feasibility of specific M&A transaction based on the results of the company valuation
• Be able to understand the fundamentals of legal, tax and accounting aspects of M&A transactions
• Be able to understand financing transactions (private equity, hedge funds, and LBO structures and valuation)
• Be able to analyze various ways of restructuring of a company to assess their applicability in a specific situation

Course Contents

• Topic 1. Growth through strategic deals, theoretical aspects
  Main trends and tendencies on the market for corporate control in developed and emerging capital markets. Motives for M&A deals in new economic conditions. Performance of M&As for targets and acquirers.
• Topic 2. M&A Deal structure
  Transaction structure. Transaction materials. Due diligence. Negotiation process. Financing mechanisms. Deal structuring.
• Topic 3. Deal valuation
  DCF method: specifics of FCFs and cost of capital estimation. Valuation of companies, using multiples. Accounting aspects. Value drivers. Information sources. Valuation of business and assets after M&A deal. Purchase price allocation.
• Topic 4. Financing Transactions
  How to choose LBO candidate? The performance of LBO deals. Common forms of LBO deal structures. LBO Valuation and Structuring Model.
• Topic 5. Cross-Border M&As
  The recent statistics and trends of the deals with international investors in Russia and current trends. Specifics of deals with international investors: what to pay attention at, while preparing and executing. What makes companies attractive for global players.
• Topic 6. Peculiarities of deals with private equity funds
  The recent statistics of the deals with PE funds in the Russian mid-market. Most active sectors. The deal process: sell-side and buy-side.
• Topic 7. Financial restructuring
  Macro overview and corporate-level restructuring. Debt and equity restructuring. Triggers for restructuring. Liquidity planning. Financial covenants. Decision on restructuring scenarios. Modelling and financial / accounting aspects. Structuring of mortgages and legal issues in restructuring.

Assessment Elements

• 2 home assignments in teams for part “Theoretical and practical aspects of M&A and LBO deals"
• 1 home assignment in teams for part “Challenges of cross-border M&As"
• 1 home assignment in teams for part “Reorganization and restructuring of companies"

Interim Assessment

• Interim assessment (2 module)
  0.25 * 1 home assignment in teams for part “Challenges of cross-border M&As" + 0.25 * 1 home assignment in teams for part “Reorganization and restructuring of companies" + 0.5 * 2 home assignments in teams for part “Theoretical and practical aspects of M&A and LBO deals"

Bibliography

Recommended Core Bibliography

• DePamphilis, D. (2015). Mergers, Acquisitions, and Other Restructuring Activities. Elsevier. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.b.eee.monogr.9780128013908
• Gaughan P., Mergers, Acquisitions and Corporate Restructuring, 6th edition, John Wiley&Sons, 2015

Recommended Additional Bibliography

• H. Kent Baker. (2011). The Art of Capital Restructuring : Creating Shareholder Value Through Mergers and Acquisitions. [N.p.]: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=391383