Merger modelling

Event type: Mastercourse

Constructing a flexible model

Date Location Price  
3 July 2012 - 09:00 London Price: GBP 695.00
Members: £625.00
Corporate discount scheme: £560.00
+ VAT on all prices.
8 November 2012 - 09:00 London Price: GBP 695.00
Members: £625.00
Corporate discount scheme: £560.00
+ VAT on all prices.

Who will benefit

All, whether experienced or new to financial modelling, carrying out business analysis that requires them to construct, specify, or design Microsoft Excel-based financial models. Delegates should have a sound knowledge of Excel and fundamental accounting.

What you can gain

During this one-day course, delegates will construct a flexible model capable of projecting the pro-forma credit ratios and combined profit metrics of a proposed transaction whilst also building the functionality to identify the optimal capital structure to be used to finance an acquisition. Best practice financial modelling and accounting techniques will be applied throughout.

 

Speaker Details

The speaker will be drawn from a pool of qualified professionals who specialise in this subject. Having worked for leading organisations they will relate the course content to real life case studies.

Outline

Setting up the model.

  • The good and bad practice modelling guidelines.
  • Understanding the structure of the model.
  • Using the group edit tools to quickly set up a robust, printable, date flexible financial model.
  • Styles.
  • Input standards.
  • Input sheets - creating underlying assumptions/forecasts.

Quick models.

  • EPS accretion.
  • Bidder PE vs. offer PE vs. cash PE.
  • The mechanics.
  • Pro-forma capital structure.
  • Credit ratios.

Step by step approach to merger modelling.

  • A modular approach.
  • The six steps.

Sources and uses.

  • Uses: equity acquisition; share options, LTIPs; refinanced debt; fees.
  • Sources: bidder cash; equity; share swap vs. placing vs. rights; impacts on weighted average number of shares; new debt.

Accounting for consideration and fees.

  • Fair value of consideration.
  • Accounting for consideration.
  • Accounting for fees.
  • Transaction fees.
  • Financing fees.

Fair value of assets and liabilities.

  • Identifying fair values and consistent accounting policies.
  • Accounting for fair values.
  • Reversal issues.

Goodwill.

  • Calculation and accounting.

Post-acquisition results.

  • Combining bidder and target adjusting for: synergies / additional costs; depreciation on capex synergies; reversals of target’s fair value adjustments / accounting policy alignments; interest on new debt; interest foregone on cash used in transaction.

Analysing the results.

  • EPS accretion / dilution.
  • Synergies required for nil dilution.
  • Credit ratios.
  • Capital structuring.
  • Finding the optimal capital structure.
  • Sensitivities.

6 CPD hours (where applicable)