Postgraduate Course: Financial Aspects of Mergers & Acquisitions (MBA) (CMSE11264)
||College||College of Arts, Humanities and Social Sciences
|Credit level (Normal year taken)||SCQF Level 11 (Postgraduate)
||Availability||Not available to visiting students
|Summary||The course aims to promote an understanding of the business environment and the tools to facilitate structured thinking about a business problem making special reference to mergers and acquisitions.
Corporate mergers and acquisitions (M&As) involve realigning the ownership and management of assets. The threat of such change represents the ultimate sanction on existing management by dissatisfied shareholders. Changes both to owners' expectations and management are intended to correct failing business strategies and disappointing financial performance. M&As may also help promote capital market and general economic allocative efficiency.
Takeovers are major business decisions involving strategy, financial analysis and policy, valuation and decision-making processes and methods both in a theoretical context and a practical setting. After completing this course students should have a good understanding of the issues involved, be able to integrate these and know how to value an acquisition prospect.
Mergers and acquisitions, and the market for corporate control.
Strategy and Valuation
Negotiating and deal structure
Evaluating M&A outcomes
M&A evidence, alternatives to acquisitions, and governance systems.
Student Learning Experience
The course is delivered through a mix of case studies (details of which will be given at the start of the course) and lectures, supported by additional selected readings from the set texts. Additional reference material will be provided during the lectures. The course features a combination of taught material, practical exercises, case studies, self-study from the set texts and supplementary readings and classroom discussion. Students are encouraged to contribute their own experiences to the discussions. The approach taken is interactive and participative, involves group work and exploration of live business issues.
Learning will primarily be through case studies and class discussions complemented with lectures. Issues around mergers and acquisitions are complex and can take time to absorb and students should expect to have to invest time prior to lectures (including having read and prepared the case before class) in order to fully understand and participate in class discussions.
Entry Requirements (not applicable to Visiting Students)
||Other requirements|| For Business School PG students only, or by special permission of the School. Please contact the course secretary.
Course Delivery Information
|Academic year 2019/20, Not available to visiting students (SS1)
||Block 5 (sem 2)
|Learning and Teaching activities (Further Info)
Lecture Hours 24,
Summative Assessment Hours 26,
Programme Level Learning and Teaching Hours 2,
Directed Learning and Independent Learning Hours
|Assessment (Further Info)
|Additional Information (Assessment)
||Takeover game: 25% group report and 25% group presentation
Group project: 50% group report.
Working in small groups, you will act as member of Board of Directors of either the target or bidder company. You will be provided with some public and some private accounting information, and will use this to determine possible valuations for the target firm. The groups will then negotiate, trying to reach a deal.
The group report will focus mainly on target valuation, while the group presentation should focus mainly on how the group went about negotiating the deal and evaluation of whether the group believe they achieved a good outcome. Marking criteria will be issued with the project requirements at the start of the course.
For the second group project, students will assess a completed acquisition, evaluating the motive and the impact of the transaction on shareholder wealth. Again, detailed requirements for the project, as well as marking criteria, will be issued at the start of the course.
||The course will be highly interactive, with the takeover game completed during an intensive week of study. Students will receive formative feedback in discussions with the Course Organiser while working on target company valuation, in preparation for negotiations and during the takeover negotiations. Summative assessment of the first project will be completed and feedback provided for the takeover game prior to students submitting the second piece of summative assessment. Marks and Feedback for the final summative piece will be provided within 15 days of submission.
Students will be provided with electronic written feedback for all coursework.
|No Exam Information
On completion of this course, the student will be able to:
- Understand and critically discuss some of the main strands of theory and the latest trends in research on which mergers and acquisitions depend.
- Critically evaluate merger motives.
- Understand and critically discuss how firms make mergers and acquisitions and how they structure and finance them.
- Critically evaluate how mergers and acquisitions affect company performance and how investors react to them.
- Understand and critically discuss some of the key success factors of mergers and acquisitions.
Sudarsanam, S., (2010), Creating value from mergers and acquisition: The challenges, FT Prentice Hall (Pearson Education), 2nd edition.
|Graduate Attributes and Skills
Demonstrate how takeovers and mergers can contribute to firm strategic success and value enhancement.
Evaluate the relevance and practical application of established paradigms and theories.
Critically appraise the importance of good merger and acquisition planning.
Take a holistic approach to solving decision problems and assessing potential outcomes using a financial framework.
Explain choices in financial assessment methods and their rationale for adoption in a particular decision issue.
Subject Specific Skills:
Utilise information and data obtained from a variety of sources, including the library, the internet, databases and management information systems for evaluating a financial problem.
Apply financial methodologies to strategic and operational level decision problems in the specific context of mergers and acquisitions.
Analyse material presented in a variety of ways and structure it into a coherent argument for evidence-based decision making.
Critically analyse problems in business finance and defend the conclusions reached.
|Keywords||Finance Strategy Mergers Acquisitions Valuation
|Course organiser||Prof Jo Danbolt
Tel: (0131 6)50 2448
|Course secretary||Mrs Angela Muir
Tel: (0131 6)51 3854