Corporate Finance (ECFS866)
Corporate Finance is concerned with understanding the link between shareholder value and corporate investment and financing strategies. Students will explore how corporate finance skills can contribute to developing value creating strategies for an organisation. Building on valuation and financial analysis skills from prerequisite courses, the unit explores how to value an organisation, and assess key investment decisions including capital investment projects, mergers, acquisitions and international investments. The impact on value of risk, optionality and strategic choices is also explored. Valuation approaches utilised include a range of Discounted Cash Flow models, Residual Income and Multiples valuation. The unit considers how to develop practical, value creating financing strategies, including the optimal mix of debt and equity, capital management and debt management strategies. Financing strategies in the context of mergers and acquisitions and international investments are also considered. The unit addresses how to calculate cost of capital for companies and projects, and how to incorporate financing impacts into a valuation. Practical issues in the implementation of the shareholder value objective, including the impact of governance strategies, alternative ownership structures and performance measures are considered.
- Understand the concept of shareholder value and the challenges to its implementation.
- Understand and implement a range of valuation methods, including discounted cash flow, residual income, multiples and continuing values.
- Assess risks in a project or business and incorporate into a valuation and investment decision.
- Apply appropriate alternative valuation models to “real world” situations.
- Understand and critically evaluate alternative capital structure and capital management strategies.
- Calculate the cost of capital for a project and company.
- Acquire familiarity with major types of corporate finance transactions including equity raising, buy-backs, asset backed financings and mergers and acquisitions.
- Shareholder Value Maximisation
- Valuation Principles: Review and Extension
- Valuation Applications: Part 1
- Valuation Applications: Part 2 - Project Evaluation
- Valuation Applications: Part 3 - Strategic Flexibility, Value and Project Selection
- Weighted Average Cost of Capital
- Capital Structure and Financial Strategy
- Alternative Valuation Models
- Capital Management and Equity Strategy
- Evaluating Asset Based Financings
- Mergers and Acquisitions
- Admission to Master of Applied Finance or Master of Applied Finance (Advanced) or Graduate Diploma of Applied Finance and
- Portfolio Management and Valuation (AFCP801) (corequisite for Full Time program) or
- Investments (ECFS865) and Financial Instruments (ECFS867)