Company and Equity Valuation Techniques

The success of all corporate transactions whether internally as part of a managing for value (sometimes called value based management) programme, or externally for purposes of acquisition, merger, divestment, buy-out, depends upon putting an accurate value on the corporate entity involved.

This course explains the concepts, principles and techniques of corporate valuation and shows participants how they can be applied in practice. To benefit fully from this course, some understanding of accounting concepts and applications is necessary; if you do not have this, we suggest that you attend ''The Essentials of Valuation Analysis'' course, which takes place immediately prior to this.

This briefing will also provide you with an understanding of circumstances when valuations are necessary, the concept of shareholder value, the crucial difference between cash and accrual accounting, the main valuation techniques and how they are used, the options for raising finance, how to structure financial packages, the practical aspects of public company takeovers, and the skills to value a private company for sale.

This programme is being provided by Dr Roger Mills an expert in company valuation, and has consulted to numerous global companies over the last few years.

The Course Outline
The number of valuation techniques available is more numerous and complex than ever before. How do you decide between? This training course will reinforce your understanding of:

• The techniques available
• Key issues in their application and common errors made in practice, and
• How to apply them to:
• IPOs
• M&A, or restructuring
• Banks for which regulatory constraints apply
• New economy businesses, e.g. relating to the valuation of high technology companies will be considered, as well as conventional old economy businesses
• Value Based Management and how valuation principles can be applied to managing the business for value
• Cross-border situations
• Emerging markets
• Intangible assets

This course will develop your valuation skills, enable you to identify and implement appropriate techniques and enable you to understand common errors made by practitioners.

About This Course

This training course has been specifically designed to cater to delegate requests for an intermediate/advanced programme. It will provide a thorough look at valuation techniques and participants should have a solid understanding of basic valuation techniques prior to the course. The programme will use case study examples to build and explain in more detail the necessary models for business valuation, many of which are computer based so please bring your laptop.

Day 1 - Valuation Technique Applications - IPO and Merger and Acquisition Analysis

Introduction and Key Valuation Issues Associated with:

• IPOs
• Mergers and Acquisitions (M&A) and restructuring

Case Study - IPO Analysis

• Valuation techniques appropriate to IPO analysis
• Developing a DCF model for analysis
• Estimating cash flow growth
• Challenges in estimating the cost of capital
• Approaches for challenging IPO valuations

Case Study - M&A and Restructuring

• Valuation techniques appropriate to M&A analysis
• Meeting the challenges of sum of the parts valuation
• Estimating the cost of capital for business units
• Estimating the business unit cost of capital
• Peer group analysis and benchmarking
• Applying peer group analysis
• Valuing the business units
• Estimating a target capital structure

Day 2 - Applications - Bank Valuation, Value Based Management (VBM) and Emerging Market Valuations

Bank Valuation

• Why banks and financial institutions need to be viewed differently from other businesses
• How valuing banks differs
• Brief review of conventional valuation measures for bank valuation
• Review of discounted cash flow approaches for undertaking the valuation of a bank

Case Study - Valuing a Bank

• Understanding the strategic and competitive context
• Undertaking a stand alone valuation
• Undertaking a valuation from different perspectives

Managing for Value (MfV), Value Based Management (VBM) and Economic Value Added (EVA?)

• What is meant by MfV and VBM
• Link between value and performance measurement and why it is important
• Conventional Methods of Performance Measurement
• Performance Measurement and Economic Value Added (EVA?)
• Reminder of EVA? and Market Value Added (MVA)
• Linking EVA? and MVA to other valuation approaches
• Effect of value based adjustments

Emerging Market (EM) Valuations

• What is different about emerging market valuations
• What are the key issues:
• Obtaining relevant and meaningful data for emerging market valuations
• Problems of availability/existence
• Problems of robustness
• Ability to apply some valuation methods
• Problems with obtaining benchmarks in relation to:
• Risk
• Cost of capital
• Cash flows

Case Studies - Involving Emerging Market Valuations

COURSE REVIEW

About Dr Roger Mills

Dr Roger Mills has unparalleled experience in the theory & practice of corporate/equity valuation, corporate financial strategy and M&A. He consults internationally to corporates and financial institutions on the application of valuation and shareholder value methodologies, and was Consultant Professor to Price Waterhouse Coopers on Shareholder Value Analysis. Recent consulting activities include work on IPOs, M&A, joint ventures, privatisation, value-based management, valuation of intangibles, principal finance & investment analysis.

He has experience of many business sectors including telecoms, banking, infrastructure, property, power and engineering. Through his consulting, training and academic appointments, Dr Mills has developed a unique resource of practical and theoretical expertise and knowledge.

In addition to his consulting activities, Dr Mills delivers training in the UK, Europe, US, Latin America and Asia Pacific. He is author of two highly respected texts, Dynamics of Shareholder Value and Strategic Value Analysis. Dr Mills is Professor of Finance and Accounting at Henley Management College, a leading UK business school, where in particular he supervises PhD & Doctor of Business Association research on finance and accounting. He is a Fellow of the Chartered Institute of Management Accountants and of the Association of Corporate Treasurers.