Corporate Finance (CF30007)

General information

Type:	OB	Curs:	1	Period:	S semester
ECTS Credits:	3 ECTS

Teaching Staff:

Group	Teacher	Department	Language
Sec: A	Vicente Jose Bermejo Boixareu	Economía, Finanzas y Contabilidad	ENG

Group	Teacher	Department	Language
Sec: B	Vicente Jose Bermejo Boixareu	Economía, Finanzas y Contabilidad	ENG

Group	Teacher	Department	Language
Sec: C	Vicente Jose Bermejo Boixareu	Economía, Finanzas y Contabilidad	ENG

This course is restricted to MSc in Finance students.

MSc in Finance Core Courses.

The Corporate Finance course of the MSc in Finance will prepare you to be a financial manager and equip you with the necessary tools to make accurate investment and financing decisions. The course complements your core Corporate Valuation course, and forms the second part of a two-course sequence covering Corporate Finance. The focus of your previous course was on investment policy and project valuation ("How much is a project worth and which projects should I pick?"). In this course we focus on capital structure theories ("How to finance a selected investment?"), pay out policy ("How should I pay investors?"), initial public offerings ("How and why does a company go public??) and corporate governance ("Which conflicts of interest among different stakeholders may arise and how can they be solved??) .

The aim of the course is to provide a broad conceptual and practical foundation for analysing issues in Corporate Finance. The course is primarily case-based because it aims to enable you to apply the concepts you learn in practice.

Upon completing this course students should be able to:

- Discuss the financing decisions of corporations.
- Understand the importance of asymmetric information and signalling in capital markets and financial decisions.
- Understand the feasibility and trade-offs employed in the different forms of restructuring for financially distressed firms.
- Critically discuss the dividend policy of a firm.
- Analyze different methods of issuing securities and understand the stock price reaction to issuing securities.
- Appreciate the various channels of corporate governance and its impact on firm value and performance.
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1. Financial Management Session1: Financial management analysis. Sources of corporate financing.

2. Capital Structure Session 2: Capital structure without taxes; capital budgeting without taxes; capital structure with corporate taxes. Session 3: The static trade-off theory. Financial distress and restructurings.

3. Agency Theory Session 4: Conflicts of interest between managers, debtholders and equity holders.

4. Payout Policy Session 5: Payout policy in perfect capital markets. Impact of taxes on payout policy. Dividends and transaction costs. Dividends and asymmetric information.

5. Initial Public Offerings and Other Equity Issues Session 6: Benefits and costs of IPOs; short-term underpricing, IPO cycles, long-run underperformance.

6. Group Presentations Session 7: Group presentations.

7. Pecking Order Theory and Corporate Governance Session 8: Pecking order theory. Event studies. Corporate Governance.

The course involves 8 three hour sessions. Sessions consist of lectures and cases, and will involve class discussion.

ASSESSMENT BREAKDOWN

The main reading materials for the course are contained in these required textbooks, all of which are available in ESADE's library:

- Fundamentals of Corporate Finance, by S. Ross, R. Westerfield and B. Jordan, McGraw-Hill Education (last edition).
- Corporate Finance by J.Berk and P.DeMarzo, Pearson Global Edition (last edition).
- Principles of Corporate Finance by R. Brealey, S. Myers and F. Allen, McGraw-Hill International Edition (last edition).

Also required for the course is a readings pack, which includes the business cases covered in the course as well as assorted readings. This material will be available online in Moodle. My lecture notes will also be available online in Moodle (as pdf files).

Group	Teacher	Department
Sec: A	Vicente Jose Bermejo Boixareu	Economía, Finanzas y Contabilidad

Group	Teacher	Department
Sec: B	Vicente Jose Bermejo Boixareu	Economía, Finanzas y Contabilidad

Group	Teacher	Department
Sec: C	Vicente Jose Bermejo Boixareu	Economía, Finanzas y Contabilidad