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Advanced Business Valuations

2 Part Course  |  Case studies from recent deals are included as are practical exercises involving problem areas in valuation.

Advanced Business Valuations Training Course

A one-day course presented in two half-day live webinars

  • Delivered online to maximise use of time
  • Flexible in terms of delivery
  • Practical valuation exercises using Excel
  • Application of valuation theory to different sectors
  • Use of valuation in an M&A context

  • Understand the importance of differentiating price and value
  • Be able to select an appropriate valuation methodology to suit the purpose
  • Create a discounted cashflow model for a corporate entity
  • Use a comparative analysis to value a corporate entity
  • Be able to discuss with a client the inherent problems within valuation theory
  • Understand how to apply valuation models to different sectors
  • Understand how to value start-up companies and early-stage development valuation methods
  • Build confidence in discussing valuation models and approaches

Part One

Advanced Discounted Cashflow Valuation

  • Recognising the difference between price and valuation
  • Applications – modelling Capex flows and working capital movements
    • understanding the linkage between reinvestment rate, growth and risk
  • Fade rates on long term cashflows
  • Problems with calculating terminal value and long term growth rates
    • alternatives to the classic terminal value perpetuity
  • Estimating asset life
  • Evaluating the stable growth period
  • Handling problems of research expenditure and operating lease payments
    • should we treat R&D as long term CAPEX?
    • capitalising lease payments
  • Effective and actual tax rates
  • The concept of normalised earnings flows to avoid abnormal cashflow patterns
  • Using multi-period terminal value models 

Weighted Average Cost of Capital (WACC) and the Discount Rate

  • Review of capital asset pricing model (CAPM)
    • understanding the drawbacks with using the model
  • How to derive equity risk premiums in different countries
  • How betas are derived – regressing company and market returns
  • A bottom-up method of calculating beta reflecting business mix and leverage
    • deleveraging betas for private company use
  • Which beta to choose for company valuation?
  • Problems with CAPM – is it really still a valid concept?
  • Alternatives to CAPM
  • Market cost of risky debt
  • WACC calculation
  • Optimal capital structure and gearing risk
  • Is WACC dead given the capital raising ability of modern firms?
  • Case study example of corporate valuation using the DCF technique

Part Two

Analysing an M&A Valuation Case

  • Evaluation of an acquisition target valuation
  • Use of selected valuation techniques
    • what synergies are possible?
    • when should synergy be considered
    • use of control premiums
  • Comparison of valuation results using DCF and relative price multiples
  • Understanding the value drivers of the company and the potential synergies
  • Comparing the pre-bid price with the actual price paid
  • Case study example of an M&A transaction 

Using EVA and CFROI Based Techniques

  • Correlation to the DCF model
  • Calculation of NOPAT and capital
  • Typical adjustments for EVA calculation
  • Understanding the MICAP (market-implied competitive advantage period) concept
  • MVA as a discounted EVA concept
  • Cashflow return on investment (CFROI) – the Holt Approach
  • Comparison of DCF, EVA and CFROI as valuation methodologies 

Real Option Valuation Techniques

  • Principle of arbitrage in deriving option-based pricing
  • Using binomial option models
  • Simplifying real option analysis using the Black Scholes model
    • problems using the Black Scholes model for valuation
  • Applications of real option valuation models; technology, patents, oil and gas, biotech, etc
  • Problems using real option models
  • Case study example of using real options in company valuation

The trainer is the Managing Director of an international advisory company specialising in advisory and development services to the corporate, banking and finance industry, which he has owned for the past 17 years. He is an experienced corporate finance professional with practical experience and extensive knowledge of corporate and structured finance in global financial markets.

He is a Visiting Fellow in the M&A department and Programme Director at Executive Development, Sir John Cass Business School, London, a member of the Visiting Faculty at Fuqua Business School and has previously worked as an advisor to the Overseas Development Administration in the UK, as well as EU PHARE and TACIS programmes throughout Europe and Russia.

The trainer’s main areas of expertise are corporate finance, M&A, corporate analysis and structured finance, asset securitization, risk management, valuation, corporate credit processes, project finance and treasury management. He currently works with many global corporate and banking clients in these areas and he also acts as an Expert Witness for London law firms in respect of his areas of expertise.

The list of global clients is extensive and covers both European, Middle East, African and Asian markets. In the corporate market, he works extensively with large corporate clients, private equity firms, private investors as well as public sector companies such as the NHS and major law firms. He provides advisory and development services to these organisations, either through the relevant departments or directly to the senior line management.

He is also a well-known figure within the various training and development companies within Europe and regularly gives seminars throughout the world on his specialist topic areas and is a recognized expert in this area by many organisations.

He was previously the Managing Director of a subsidiary of Union Plc, a London merchant bank having previously worked with several high profile global investment banks. He left Union Plc in 1996 to form his own international advisory Company.

The list of financial institutions and corporates with whom he has worked over recent years is extensive and includes Allied Irish Bank, Alpha Bank, Bank of America Merrill Lynch, Bank of China, Barclays, Bayern LB, BT plc, Citibank, China Construction Bank, Credit Agricole, Credit Suisse, Danone, DECC, Deloitte, Dexia, Emirates Bank, E&Y, Euler Hermes, First Gulf Bank, FSA London, Garanti Bank, HBOS, Hohhot Bank Mongolia, HSBC, HVB, Iccrea Banca, Intesa SanPaolo, Central Bank of Ireland, KPMG, L’Oreal, Malta FSA, Mongolian Stock Exchange, Morgan Stanley, Mubabdala, NHS and many others.

In the current climate, the valuation of assets and companies is subject to considerable debate.  There is often a wide disparity between the views of buyer and seller given the degree of uncertainty regarding future cashflows.  The increased volatility of future cashflows in more difficult valuation scenarios further widens this perception gap.

The valuation problem is compounded by the misconception regarding the difference between the price that is paid for an asset and the expected future value of the asset. Price and value are not the same and valuation models allow us to understand the difference between what you pay for an asset and what future value you may derive from that asset.

This seminar takes valuation techniques much further than the introductory course and considers important contemporary techniques including the application of the techniques in mergers and acquisitions, understanding EVA, the application of CFROI and the use of real option analysis.

Case studies from recent deals are included as are practical exercises involving problem areas in valuation. The seminar also includes critiques of the conventional techniques and considers suitable alternatives to be deployed in differing circumstances. Participants will be required to bring a laptop to the course and will be provided with Excel models which will be used during the course.

  • There was a good use of examples throughout
  • This course was perfect
Number of places:
Part 1
Number of places:
Part 2

£795.00

Per participant per part
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