Corporate Valuation Techniques

IFF Training

IFF Training

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About the course

Focuses on the core skills required for the successful application of corporate valuation techniques

Whatever your reason for valuing a company, whether it be for mergers and acquisitions, selling, restructuring, creating or increasing shareholder value, you will understand and appreciate the importance of achieving accurate valuations. However, what many fail to anticipate is the complexity involved in the process, and as a result, they can find themselves making the wrong decisions or simply overpaying.

This course will present you with a thorough and detailed exposition of the approach to corporate valuation methodology, enabling you to identify and analyse major relevant economic, industry and corporate issues.

*EQUIP YOURSELF WITH THE SKILLS TO: *

  • Determine which valuation technique is appropriate for the analytical objective
  • Value companies in the context of mergers, acquisitions, private equity, project appraisal and IPOs
  • Assess the impact of corporate decisions on the value of the business
  • Quantify and manage the risks associated with corporate valuation
  • Assess whether management are creating shareholder value
  • Evaluate corporate valuation and pricing models

WHAT YOU WILL LEARN

  • why corporate valuation techniques are central to many strategic decisions
  • what alternative approaches can be used in specialised situations
  • the shortcomings associated with using conventional accountingoriented approaches in corporate valuations
  • why the discount rate is important in the valuation process and how it can be estimated for private companies and business units
  • how to assess market appetite with pricing models
  • how to apply modelling techniques to determine not only valuation, but pricing, acquisition control premiums, and management performance
  • successful techniques for generating shareholder wealth

Agenda Summary

Preliminary Matters

  • Price vs. value
  • Perspective of techniques
  • Risk
  • Company dynamics
  • Return on Capital vs. Cost of Capital

Free Cash Flow (FCF)

  • Importance of FCF
  • Limitations of accounting-based data
  • Components and detailed calculation

Exercise Deriving FCF

DCF Valuation

  • Cost calculations of the capital components
  • Areas of controversial debate in deriving cost of capital
  • share market premium
  • betas
  • Discounting
  • Investment horizon
  • The continuing period
  • Adjustments to achieve attributable value
  • Sensitising valuation analyses
  • Decision-making using the contrasting of valuation techniques and pricing techniques
  • Application of valuation techniques to
  • leveraged buyouts
  • mergers& acquisitions
  • limited recourse financings
  • emerging markets
  • project appraisal
  • private companies

Exercise Discounting of cashflows

Case Study DCF valuation

  • Applying the techniques to determine the value range of a retailing company. Debriefing of the case study.

Pricing Techniques - Comparatives

  • Selecting comparatives
  • The necessary adjustments when using multiples;
  • Total enterprise value
  • Comparative ratios – P/E, EBITDA multiples, etc
  • Designing and using pricing models;

Case Study Comparative pricing

  • Working through the case study and debrief

Dividend Valuation Model

  • Dividend growth approach
  • When dividend valuation should be used

Residual Valuation Matters

  • The effect of leverage on risk and return
  • Optimal capital structure
  • Adjusted present value

Corporate Valuation Modelling

  • Estimating future cashflows and returns
  • Designing and using Valuation models
  • The modelling of cost structures
  • Sensitising the cash flow forecast
  • Establishing a valuation range

A Review of Errors Frequently Encountered

  • Modelling the effect of inflation
  • Dealing with currency exposures
  • The horizon
  • Sensitising capital expenditures in the continuing period
  • The calculation of IRRs

Economic Value Added (EVA)

  • The range of performance evaluation techniques
  • Detailed calculations
  • Analysis of results of analysis
  • Market Value Added (MVA)
  • Correlation of market price to EVA performance
  • Strategic interpretation of EVA analysis

Experts

Richard Capps

Richard obtained a law degree from Cambridge University and was called to the English Bar in 1976. Shortly thereafter he entered banking joining Chase Manhattan Bank where, for most of the 5 years service, he was a corporate relationship manager in London and New York. For the following 6 years ...

Videos and materials

Corporate Valuation Techniques at IFF Training

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Disclaimer

Coursalytics is an independent platform to find, compare, and book executive courses. Coursalytics is not endorsed by, sponsored by, or otherwise affiliated with any business school or university.

Full disclaimer.

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