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Details

During this top-level training we will provide you with hands-on tools for building financial models in Excel in order to determine the value of a company:

  • On a stand-alone basis
  • In a Leveraged Buy-Out (LBO) situation
  • In a buy-side Merger & Acquisition (M&A) scenario

You will learn all the Excel shortcuts needed to become an excellent financial modeller. We will look at various valuation techniques for calculating enterprise value, such as:

  • Comparable companies analysis
  • Precedent transaction analysis
  • Discounted Cash Flow (DCF) analysis
  • Leveraged Buy-Out (LBO) analysis
  • Buy-side Merger & Acquisition (M&A) analysis

We will also look into various techniques for making the step from enterprise value to the value of the shares, taking into account (adjusted) net debt. The trainer will first explain the concepts and then apply them to real companies.

Outline

DAY I

ANALYSIS OF COMPARABLE COMPANIES

Select the sphere of comparable companies
  • Identify key characteristics of the target for comparison purposes
  • Screen for comparable companies

Locate the necessary financial information

  • SEC filings: 10-K, 10-Q, 8-K, and proxy statements
  • Equity research
  • Press releases and news runs
  • Financial information services
  • Summary of financial data primary resources

Spread key statistics, ratios and trading multiples

  • Calculation of key financial statistics and ratios
  • Supplemental financial concepts and calculations
  • Calculation of key trading multiples

Benchmark the comparable companies

  • Benchmark the financial statistics and ratios
  • Benchmark the trading multiples

Determine valuation

  • Valuation implied by Enterprise Value (EV)/EBITDA
  • Valuation implied by Price/Earning (PE)

Key pros and cons of analysis of comparable companies

DAY II

ANALYSIS OF COMPARABLE TRANSACTIONS

Select the sphere of comparable acquisitions

  • Screen for comparable acquisitions 
  • Examine other considerations 

Locate the necessary deal-related and financial information

  • Public targets
  • Private targets
  • Summary of primary SEC filings in M&A transactions

Spread key statistics, ratios and trading multiples

  • Calculation of key financial statistics and ratios
  • Calculation of key trading multiples

Benchmark the comparable companies

Determine valuation

Key pros and cons of analysis of comparable transactions

ANALYSIS OF DISCOUNTED CASH FLOW (DCF) 

Study the target and determine key performance drivers

Project free cash flow

  • Considerations for projecting free cash flow
  • Projection of sales, EBITDA and EBIT
  • Projection of free cash flow

Calculate Weighted Average Cost of Capital (WACC)

  • Determine target capital structure 
  • Estimate cost of debt
  • Estimate cost of equity
  • Calculate WACC

DAY III

ANALYSIS OF DISCOUNTED CASH FLOW (DCF) 

Determine terminal value

  • Exit multiple method
  • Perpetuity growth method

Calculate present value and determine value 

  • Calculate present value
  • Determine valuation
  • Perform sensitivity analysis

Key pros and cons of analysis of Discounted Cash Flow (DCF)

LEVERAGED BUY-OUTS (LBOs)

Key participants

  • Financial sponsors
  • Investment banks
  • Bank and institutional lenders
  • Bond investors
  • Target management

Characteristics of a strong LBO candidate

  • Strong cash flow generation
  • Leading and defensible market positions
  • Growth opportunities
  • Low capex requirements
  • Strong asset base
  • Proven management team

Economics of LBOs

  • Return analysis: internal rate of return (IRR)
  • Return analysis: cash return
  • How LBOs generate return
  • How leverage is used to enhance returns

Primary exit/monetization strategies

  • Sale of business
  • Initial Public Offering (IPO)
  • Dividend recapitalisation
  • Below par debt repurchase

LBO financing: structure

LBO financing: primary sources

  • Bank debt
  • High-yield bonds
  • Mezzanine debt
  • Equity contribution

LBO financing: selected key terms

  • Security
  • Seniority
  • Maturity
  • Coupon
  • Call protection
  • Covenants
  • Term sheets

LBO financing: determine financing structure

DAY IV

ANALYSIS OF LEVERAGED BUY-OUT (LBO)

Locate and analyse the necessary information

Build the pre-LBO model

  • Build historical and projected income statement through EBIT
  • Input opening balance sheet and project balance sheet items
  • Build cash flow statement by means of investing activities 

Input transaction structure

  • Enter purchase-price assumptions
  • Enter financing structure into sources and uses
  • Link sources and uses to balance sheet adjustments columns

Complete the post-LBO model

  • Build debt schedule
  • Complete pro forma income statement from EBIT to net income
  • Complete pro forma balance sheet
  • Complete pro forma cash-flow statement

DAY V

LEVERAGED BUY-OUT (LBO) ANALYSIS

Perform Leveraged Buy-Out (LBO) analysis

  • Analyse financing structure
  • Perform return analysis
  • Determine valuation
  • Create transaction summery page

SELL-SIDE MERGERS & ACQUISITIONS (M&A)

Auctions

Organisation and preparation

First round

Second round

Negotiations

Closing

Negotiated sale

DAY VI

BUY-SIDE MERGERS & ACQUISITIONS (M&A)

Buyer motivation

  • Synergies
  • Cost synergies
  • Revenue synergies

Acquisition strategies

  • Horizontal integration
  • Vertical integration
  • Conglomeration

Form of financing

  • Cash on hand
  • Debt financing
  • Equity financing
  • Debt vs. equity financing summary - acquirer perspective

Deal structure

  • Stock sale
  • Asset sale

Buy-side valuation

  • Football field
  • Analysis at various prices
  • Contribution analysis

Merger consequences analysis

  • Purchase price assumptions
  • Balance sheet effects
  • Accretion/dilution analysis
  • acquisition scenario's: 50% stock/50% cash, 100% cash, 100% stock

Special Offer

This training may qualify for CPE credits, pursuant to the rules of professional organisations in many countries. Please check with the professional organisation(s) in your country to determine eligibility in this respect.

Schedules

Oct 02, 2019
Weekdays 10:00 AM — 07:00 PM
No. of Days: 6
Total Hours: 54
No. of Participants: 10
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IMF Academy is an independent publisher of distance learning courses and organizer of hot topical classroom based trainings. IMF focuses on business information for managers and decision-makers in large and middle-sized companies and non-profit organizations. During the past 20 years, we gained a solid reputation by providing to-the-point and valuable information about topics both critical and of current interest.

Beside of this, we offer a lot of classroom based trainings. Topics vary from subjects in the area of Information Technology, Finance/Tax, Project Management and (IT) Security Management.

Most courses are in the Dutch language; others are published worldwide in the English language. Our courses are mainly edited by specialists working at the large international consultancy organisations like (among many others) PwC, KPMG, Deloitte, Atos Origin, IBM Business Consulting Services, Capgemini, EY (Ernst & Young), Sogeti and Transfer Pricing Associates. Our authors and trainers are all leading specialists in their field.
IMF Academy
Fellenoord 224, Eindhoven, Netherlands 5611 ZC
+31 (0)40 246 02 20
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