The Modelling for M&A Course

£1,800.00 +VAT

This course can also be presented face to face in-house or via live in-house webinar.

Modelling for M&A Course Objectives:

Participant will:

  • Learn about the key drivers on M&A
  • Master the modelling of integrated financial statements
  • Learn how to use financial statements to value a business
  • Get grip with modelling the balance sheet impact of transactions
  • Gain an appreciation of incorporate synergies into modelling work
  • Learn how to differentiate between financing and operating synergies
  • Be taught how acquisitions can be structured
  • Learn how to work with integrated financial statements
  • Be shown how to develop the acquisition structure and modelling instruments
  • Become familiar with running scenarios, iterating and optimising

Modelling for M&A Course Content:

Day One:

M&A model build up: the starting point

  • Modelling integrated financial statements
  • Model structure
  • Key forecast ratios
  • Sourcing and cleaning historic data
  • What makes a good model?

Modelling – integrating financial statements: participants complete a partially-developed financial model for a public quoted company which integrates P&L, balance sheet and cash flow. This company will be the target company used in the merger analysis

Modelling stand-alone valuation

  • Overview of valuation methodologies
  • What do investment banks do?
  • What methodologies could we use?
  • How should we define firm value? Equity vs. enterprise value
  • Calculating free cash flow before financing
  • Understanding and calculating WACC
  • Discussion – calculating WACC
  • Key issues with a two stage DCF valuation – WACC and terminal value assumptions

Modelling – valuation: participants calculate the cost of capital and complete a DCF valuation for the target company, producing a stand-alone valuation as a cross check to the acquisition price

Day Two:

Accounting for corporate transactions

  • Different types of transaction and how they are modeled in practice
  • Consolidation accounting under the current IFRS 3 an IAS 27
  • Change of control triggers
  • Accounting for non-controlling interests (“NCI”)
  • Accounting for disposals
  • Partial disposals – creating a NCI
  • Partial disposal – loss of control
  • Recent changes to acquisition accounting under IFRS
  • Definition of control
  • Calculation of goodwill

Modelling: delegates complete a variety of transaction models incorporating all types of corporate transaction and calculate the effect of a transaction on a set of consolidated accounts in preparation to perform a merger analysis with the target business and an acquirer

Acquisition finance

  • Types of transactions and synergies
  • Availability of synergies and problems in achieving them
  • Methods available for valuing synergies
  • Key differences between public vs. private deals, recommended vs. hostile bids
  • Choices for growth: acquisition vs. organic vs. joint venture
  • Defence strategies for target companies resisting a hostile bid

Case study: Participants calculate synergies for a case company

Day Three:

Structuring acquisition finance

  • Once price has been agreed, how is it paid? Cash vs. Shares
  • Financing choices for raising cash for an acquisition: Debt vs. Equity
  • Calculating the success of a deal, accretion vs value creation
  • The nature of equity instruments
  • The different risks and rewards accruing to different parties
  • The impact of loan stock, convertibles and preference shares on WACC
  • Calculating returns to key participants

Case study: Calculating accretion/dilution and the effect of hybrids on cost of capital 

Modelling for Mergers and acquisitions case study

  • Completing a merger model
  • Getting to DCF valuation for the combined business
    • Combined WACC
  • Valuing operating synergies
  • Valuing financing synergies
  • Accretion/dilution analysis vs wealth creation
  • Sense-checking the output and adjusting the capital structure

Modelling – bringing it all together: participants complete a complex merger model for an acquisition of the target business incorporating synergy analysis and varying capital structure. The transaction is analysed on an accretion/dilution analysis and a wealth creation/return on capital analysis

At the end of this session participants will have a working acquisition model incorporating a variety of different forms of transaction analysis

Course conclusion: best practice in transaction analysis

  • Participants will have improved their understanding of and have had experience of modelling mergers and acquisitions from first principles
  • Simple and clear reference Excel models – providing participants with a platform for future internal modelling efforts and aiding decision making
  • Participants who, at the end of the course, understand the drivers on transactions and how transactions can be modified to suit the various parties

Background of the trainer:

The trainer is a qualified chartered accountant, who spent several years in corporate finance post qualification. He then spent 18 years in the investment management industry as an analyst/fund manager with Threadneedle Asset Management, a director and head of UK Equities at Scottish Widows Investment Partnership as European, then Global Head of Equity Research at HSBC Asset Management. He ran various types of retail and wholesale funds and produced research on companies in Europe and on a global basis. He developed valuation and research processes and managed teams of European and global analysts and fund managers.

Since leaving the investment management industry the trainer has managed the investment management and investment banking operations of a UK based training company developing programmes for clients as diverse as HSBC, Morgan Stanley, Deutsche Bank, Citigroup, Allen & Overy, JP Morgan, Barclays Bank, Barclays Wealth, Morgan Stanley Investment Management and Schroders. He has managed major graduate programmes for investment banking and investment management clients, training graduate to managing director level participants and advising clients on their training requirements for accountancy, corporate finance and valuation, investment management and private wealth training.

Modelling for M&A Course Summary:

This modelling for M&A course covers the key elements of an acquisition or merger, from the initial stand-alone valuation of the target to the more complex accounting and modelling issues to be considered and finally analysing and assessing the value created by synergy benefits and leverage.

This modelling for M&A course is run in an interactive, participative format, where participants learn by doing. The key concepts covered in the main teaching sessions are punctuated and illustrated by detailed case and modelling work.

The approach has been designed to equip participants to put key concepts into practical use immediately.

Participants will be led through a comprehensive review of analysis practices, from initial principles through to more advanced techniques that are used in transaction analysis, to allow them to be proficient in modelling for mergers and acquisitions.

As part of their work on this course participants model transactions based on real-life companies and scenarios

By the end of this course participants will understand:

  • Drivers on M&A
  • How to model integrated financial statements
  • How to use financial statements to value a business
  • How to model the balance sheet impact of transactions
  • How to incorporate synergies into modelling work
  • How to differentiate between financing and operating synergies
  • How acquisitions can be structured

Much of the course work involves Excel modelling and analysis, equipping participants with the tools to analyse leveraged acquisitions:

  • Building up from partially-complete models
  • Working with integrated financial statements
  • Developing the acquisition structure and modelling instruments
  • Running scenarios, iterating and optimising

Each participant should bring a lap top with USB port to the course to facilitate modelling work.

5/5 (1 Review)

5-6 participants – 20% discount,7-8 participants – 25% discount,Over 9 participants – 30% discount


12-14 November 2018, 11-13 February 2019, 24-26 June 2019, 4-6 November 2019