ICM311-Corporate Finance and Investment Banking

Module Provider: ICMA Centre
Number of credits: 20 [10 ECTS credits]
Level:7
Terms in which taught: Spring term module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites: ICM108 Fixed Income and Equity Investments
Modules excluded:
Current from: 2020/1

Module Convenor: Prof George Alexandridis
Email: g.alexandridis@icmacentre.ac.uk

Type of module:

Summary module description:

The module is designed to develop practical skills essential for roles within corporations and financial advisory firms, that can be applied directly to the workplace. It provides a rigorous grounding on the practice of corporate finance and more specifically the long-term financial management decisions of the firm pertaining to investments, financing and payout and how they affect firm value. Along these lines, it deals with how corporations are governed, optimal financing structures, payout policies, the processes involved in the issuance of public, private equity, and growing through inorganic investment (mergers and acquisitions). Participants will also learn how to utilize best practice techniques for business valuation and financial modelling employed by financial advisors/investment banks as part of providing advice to corporations. The module is assessed via a bespoke investment banking pitch-book simulation challenge designed at the ICMA Centre. As part of this, they work as part of their team to produce a pitch-book and financial analysis for a real-life scenario/transaction as part of assessing a company’s strategic alternatives. In addition to lectures and case study based seminars the module also includes 2 x 1-day financial modelling and valuation training Masterclasses by Financial Edge, the company responsible for training the analysts of the leading 4 investment banks. Students that take active part in the Masterclasses will also receive a certificate of participation by Financial Edge, which they can include in their CV.

Aims:

The module is designed to develop practical skills essential for roles within corporations and financial advisory firms, that can be applied directly to the workplace.

Assessable learning outcomes:

By the end of the module, it is expected that the student will be able to:

• Critically discuss the ethical responsibility of the corporation and trends in stakeholder capitalism


• Recognize value increasing corporate governance characteristics and latest trends in corporate governance


• Explain the practical differences between financing alternatives and the associated processes involved in raising financing


• Propose a nd defend a financing strategy for a real firm


• Assess optimal capital structure and payout policy in the presence of market imperfections


• Critically discuss the mechanisms and pros and cons for different forms of payout


• Critically assess the scope/motives of merger and acquisitions (M&As), the pros and cons of alternative financing methods and value creation potential


• Value a real corporation using best-practice valuation method s (DCF, Multiples, LBO)


• Design and build a comprehensive “pitch-book” for a real-life transaction including, undertaking independent research analysis and employing financial modelling techniques��


• Present a coherent investment story and strategic alternatives for a real company��

Additional outcomes:

The module also aims to encourage teamwork and communication skills via case study methods and group discussion. Students will get exposure to real corporate finance problems and analyse industry and company information from various sources including Bloomberg and Refinitiv Eikon. They will also learn to utilize spreadsheet based best-practice financial modelling techniques

Outline content:

• Objectives of the Firm and Stakeholder Capitalism


• Corporate Governance ��


• Private and Public Equity��


• The Capital Structure Decision��


• Payout Policy��


• Mergers and Acquisitions��


• Advanced Financial Modelling and Valuation


• Pitchbook building

Global context:

The module makes extensive use of examples and cases from a number of different markets including but not limited to the UK, US, EU and China.

Brief description of teaching and learning methods:

Lectures are designed to offer a practical understanding of the topics

Seminars will be used to discuss non-assessed problem sets and case studies. There will be 7 x 2-hour lectures, 8 x 1. hour seminars and 2 x 6 hour Masterclasses.��

Summative assessment- Examinations:

Summative assessment- Coursework and in-class tests:

Mid-term exam: 40% of the total final assessment mark (around week 27)

4,000 word group project: 60% of the total final assessment mark (20% of this mark is based on group peer evaluation)

Formative assessment methods:

Penalties for late submission:

Penalties for late submission on this module are in accordance with the University policy. Please refer to page 5 of the Postgraduate Guide to Assessment for further information: http://www.reading.ac.uk/internal/exams/student/exa-guidePG.aspx

Assessment requirements for a pass:

A minimum total mark of 50% for the module

Reassessment arrangements:

Through individual project to be submitted in August of the same year.

Additional Costs (specified where applicable):

Last updated: 3 November 2021