Corporate Finance (MSB309)

The course is a Master level corporate finance class that emphasizes real-life decision-making. Inorder to make insightful financial decisions, it is important to comprehend the implications of various financial theories. Thus, the first half of the course covers important financial theories,corporate governance systems and mechanisms, the functioning of financial markets and risk assessments. Emphasis is placed on managerial financial decision-making and the roles of information asymmetries, economic incentives and behavioral biases. This is then followed by more in-depth analyses of classic corporate finance decisions such as capital structure, payout policy and investment appraisals, before leading to more specialized decisions including various forms of corporate restructuring.

(1-4) Basics - NPV without risk

Bonds

Investment criteria

Stock valuation

(5-6) Risk and Return

Portfolio

Capital market equilibrium (CAPM)

(7) Cost of Capital

(8) Financial structure

(9) Payout policy

(10) Mergers and Acquisitions

Knowledge

Upon completion of the course, students will have knowledge of

• The theories necessary to understand various financial decisions.
• The structuring and functioning of corporate governance systems used to control widely held companies.
• The functioning of financial markets, both local and international, and how managers use them in financial decision-making.
• The key drivers of important financial policy decisions, including capital structure, payout, risk management, and investment decisions.
• The role of information asymmetries, economic incentives and behavioral biases for financial decision-making.
• Independently analyze and assess the financial and governance positions of real-life companies, including ethical and sustainability perspectives.

Skills

Upon completion of the course, students will have the ability to

• Analyze, assess and make suggestions of what are appropriate financials decisions of real-life companies, including capital structure, payout policy and capital allocation decisions.
• Present and discuss remedies for concrete financial problems and, in so doing, integrate different perspectives to produce a balanced overall decision.
• Solve problems through group work and present case solutions.
• Set up and use basic financial modeling tools.