Fundamentals of Corporate Finance

What does corporate finance actually involve?

• Corporate finance and the company business cycle
• Types of transaction
• Main business areas

Key concepts/ principles in corporate finance

• Present value and future value
• Capital asset pricing based on risk
• Efficient capital markets
• Value creation is the key: how to measure?
• The significance of capital structure choices

People skills matter

• Building trust and credibility: particularly important in corporate finance
• Why advisory firms tend to get chosen
• Practitioner skillsets: senior and junior
• Six steps to building an advisory relationship
• Case study: Project Castle

What does any good corporate finance deal require?

• Best practice: sell-side and buy-side
• Demonstrating value: The importance of a good ‘story’
• Case study: Project Hush
• What do we mean by value creation? ROIC – WACC introduced
• Other financial measures
• The importance of managing all interested parties

Overview of typical corporate finance processes

• M&A transactions – buy and sell-side
• Capital raising – public and private
• Initial public offering
• Common threads and underpins

Examples of processes

• Common threads and key variables/ choices: Four case studies
  • Classic M&A process but with buyer A and B lists
  • Bespoke M&A process – working around an off-market approach
  • Twin-track M&A sale process – leading to Private Equity and an MBO
  • Capital raising and introducing strategic/ inductrial partner
• Summary/ discussion

Corporate finance analysis: Focus on value creation and returns

• What constitutes WACC - and why does WACC matter?
• Cost of debt
• Cost of equity and its components: beta, alpha and equity risk premium
• What capital structure to apply?
• Case study – Project Hull’s WACC
• The components of cash flow
• Picking out NOPAT from within cash flow to derive ROIC
• The significance of capex/ reinvestment (R)
• The relationship between R and growth

Valuation – a key corporate finance skill

• Valuation theory: three methods …
• … or two, for solvent businesses
• The earnings method: a short step from the ROIC – WACC framework
• The market method: what we do, when an earnings approach is not practical
• The challenges in picking comparable
• Understand there can be genuine debating points

Some key components of corporate finance processes

• Preparation – why it matters
• Going to market – choices
• Marketing documents – understand their true purpose
• Due diligence overview
• Choosing a ‘winner’ 
• … and locking in terms
• How to work well with legal advisers

Tradecraft: why soft skills also matter in corporate finance

• What if your deal may be going wrong? Tactics to consider
• Understand the reality of the negotiating framework
• What really constitutes a BATNA, in corporate finance?
• How to engage – well – in debating deal issues
• Good and bad behaviour

Conclusion: what makes good practitioners and good corporate finance business

• Questions, debate, discussion

Our trainer has worked on corporate finance and capital markets transactions for over thirty years. He has held positions on the client side as well as leading advisory teams.

At the Department of Energy, he was a civil servant involved in the privatisation of British Gas, a global IPO involving a large advisory team. He also spent two years (1990-92) in the Hungarian Government privatisation agency, working with many advisory firms, as the changing political environment triggered massive ownership change.

Our corporate finance fundamentals course lead has worked in major investment banks (Swiss Bank Corporation International – now UBS - and Lazard) and also co-founded a successful M&A advisory boutique firm. In 2021, he retired from KPMG, where he spent 13 years in the firm’s global M&A business, based in Scotland.

His experience combines a broad range of M&A and equity transactions in North and Central America, Asia Pacific, and all the major European countries, and more recently, in Africa. His courses draw on case studies from his past transactions, bringing practical examples to set alongside the theory.

Redcliffe’s corporate finance fundamentals course delivers key concepts of corporate finance. There are 5 learning objectives to help focus and advance your career:

• Client service: what corporate financiers do, day-to-day, and their overriding aim on behalf of their clients
• Why finance is sought and raised: understanding the motives on each side of the transaction
• What buying and selling businesses entail
• How to manage a corporate finance process
• The ability to give clients good, clear and trusted advice in complex and sensitive areas

Our Corporate Finance Fundamentals course is a ‘must know’ for:

• Professionals likely involved in corporate finance transactions
  • Advisers or principals wishing to build their ability to execute capital raising and M&A transactions, including:
  • Corporate finance professionals in investment banks, boutique advisory businesses, and the corporate finance arms of accountancy firms
  • Corporate business development teams, where M&A is a key part of their strategy
  • Owner-managers of successful businesses considering expansion by acquisition, or raising capital
  • Private equity professionals, especially those new to the industry, who may have backgrounds as lawyers, accountants or consultants

And a ‘nice to know’ for:

• Legal and other advisers working in corporate finance practices, seeking a better understanding of how principals and their financial advisers initiate corporate finance deals and negotiate terms

This Fundamentals of Corporate Finance course is especially beneficial for professionals with some experience in transactions who want to speed up their understanding of what drives successful deals.

We can refine course material for a private session to meet the specific needs of the client. Whether they are a business owner contemplating a sale, a company looking to make acquisitions, or an advisory firm building its M&A practice.

Redcliffe Training’s Corporate Finance Fundamentals course is a practical guide for professionals who want to learn what corporate finance is all about. We make clear what corporate finance entails, as well as the key challenges and choices involved in corporate finance projects.

This workshop will help accelerate your learning, understanding and career progression. Making it ideal for ambitious, though still inexperienced, practitioners.

The session delivers essential introductory learnings for anyone starting a career in corporate finance, It draws content from several of Redcliffe’s popular, long-established corporate finance and M&A courses in a condensed and easily digestible half-day session.

The emphasis is on a practical introduction to corporate finance work: raising money, and buying and selling businesses.

The teaching is enlivened by real-world examples and experience throughout, combined with a straightforward explanation of the underlying rationale.

The half day format allows participants to accelerate their learning in an efficient and engaging session.