Tài liệu McGraw.Hill - Brealey & Myers - Principles of Corporate Finance, 6th Edition Slides docx

Principles of Corporate Finance Brealey and Myers u Sixth Edition Finance and the Financial Manager Chapter Topics Covered w What Is A Corporation? w The Role of The Financial Manager w Who Is The Financial Manager? w Separation of Ownership and Management w Financial Markets Corporate Structure Sole Proprietorships Unlimited Liability Personal tax on profits Partnerships Limited Liability Corporations Corporate tax on profits + Personal tax on dividends Role of The Financial Manager (2) (1) Financial manager Firm's operations (4a) (4b) (3) (1) Cash raised from investors (2) Cash invested in firm (3) Cash generated by operations (4a) Cash reinvested (4b) Cash returned to investors Financial markets Who is The Financial Manager? Chief Financial Officer Treasurer Comptroller Ownership vs Management Difference in Information w Stock prices and returns w Issues of shares and other securities w Dividends w Financing Different Objectives w Managers vs stockholders w Top mgmt vs operating mgmt w Stockholders vs banks and lenders Financial Markets Money Primary OTC Markets Markets Secondary Markets Financial Institutions Company Obligations Funds Intermediaries Banks Insurance Cos Brokerage Firms Financial Institutions Intermediaries Obligations Funds Investors Depositors Policyholders Investors Principles of Corporate Finance Brealey and Myers u Sixth Edition Present Value and The Opportunity Cost of Capital Chapter 802 Topics Covered w Leveraged Buyouts w Spin-offs and Restructuring w Conglomerates w Private Equity Partnership w Control and Governance 803 Definitions w Corporate control the power to make investment and financing decisions w Corporate governance the role of the Board of Directors, shareholder voting, proxy fights, etc and the actions taken by shareholders to influence corporate decisions w Financial architecture the financial organization of the business 804 Leveraged Buyouts w The difference between leveraged buyouts and ordinary acquisitions: A large fraction of the purchase price is debt financed The LBO goes private, and its share is no longer trade on the open market 805 Leveraged Buyouts w The three main characteristics of LBOs: High debt Incentives Private ownership 806 Leveraged Buyouts 10 Largest LBOs in 1980s and 1997/98 examples Acquirer KKR KKR KKR Thompson Co AV Holdings Wing Holdings KKR TF Investments FH Acquisitions Macy Acquisition Corp Bain Capital Citicorp Venture Capital Cyprus Group (w/mgmt) Clayton, Dublier & Rice Clayton, Dublier & Rice (w/mgmt) Kohlberg & Co (w.mgmt) Target RJR Nabisco Beatrice Safeway Southland Borg-Warner NWA, Inc Owens-Illinois Hospital Corp of America For Howard Corp RH Macy & Co Sealy Corp Neenah Corp WESCO Distribution Inc North Maerican Van Lines Dynatech Corp Helley Performance Products Year Price ($bil) 1989 1986 1986 1987 1987 1989 1987 1989 1988 1986 1997 1997 1998 1998 1998 1998 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 24.72 6.25 4.24 4.00 3.76 3.69 3.69 3.69 3.59 3.50 811.20 250.00 1,100.00 200.00 762.90 100.00 807 Spin-offs, etc w Spin off debut independent company created by detaching part of a parent company's assets and operations w Carve-outs similar to spin offs, except that shares in the new company are not given to existing shareholders but sold in a public offering w Privatization the sale of a governmentowned company to private investors 808 Privatization w Motives for Privatization: Increased efficiency Share ownership Revenue for the government 809 Privatization Examples of Privatization Country France France Germany Jamaica Jpan Mexico New Zealand Singapore United Kingdom United Kingdom United Kingdom United States Company and Date St Gobain (1986) Paribas (1987) Volkswagon (1961) Caribbean Cement (1987) Japan Airlines (1987) Telefonos de Mexico (1990) Air New Zealand (1989) Neptune Orient Lines (1981-1988) British Gas (1986) BAA (Airports)(1987) British Steel (1988) Conrail (1987) Amount Issued, $ millions $ $ $ $ $ $ $ $ $ $ $ $ 2,091.40 2,742.00 315.00 45.60 2,600.00 3,760.00 99.10 308.50 8,012.00 2,028.00 4,524.00 1,650.00 810 Conglomerates The largest US conglomerates in 1979 Sales Rank 15 42 51 66 73 103 104 128 131 132 143 173 180 188 Company ITT Tenneco Gulf & Western Industries Litton Industries LTV Illinois Central Industries Textron Greyhound Marin Marietta Dart Industries U.S Industries Northwest Industries Walter Kidde Ogden Industries Colt Industries Numebr of Industries 38 28 41 19 18 26 16 19 14 18 24 18 22 13 811 Private Equity Partnership Investment Phase Payout Phase General Partner put up 1% of capital General Partner get carried interest in 20% of profits Mgmt fees Limited partners put in 99% of capital Partnership Partnership Company Investment in diversified portfolio of companies Company Sale or IPO of companies Company N Limited partners get investment back, then 80% of profits Principles of Corporate Finance Brealey and Myers u Sixth Edition Conclusion: What We Do and Do Not Know about Finance Chapter 35 813 Topics Covered w What We Do Know w What We Do Not Know 814 Most Important Ideas in Finance w Net Present Value w Capital Asset Pricing Model (CAPM) w Efficient Capital Markets w Value Additivity & Law Conservation of Value w Capital Structure Theory w Option Theory w Agency Theory 815 10 Unsolved Problems In Finance w How major decisions are made? w What determines project risk and PV ? w Risk and return - What have we missed? w How important are the exceptions to the Efficient Market Theory? w Is management an off-balance-sheet liability? 816 10 Unsolved Problems In Finance w How can we explain the success of new markets and new securities? w How can we resolve the dividend controversy? w What risks should a firm take? w What is the value of liquidity? ... Investors Depositors Policyholders Investors Principles of Corporate Finance Brealey and Myers u Sixth Edition Present Value and The Opportunity Cost of Capital Chapter 11 Topics Covered w Present... PV of C1 = $400 at 12% 400 PV = = 357 + 12 PV of C1 = $400 at 7% 400 PV = = 374 + 07 20 Rate of Return Rule w Accept investments that offer rates of return in excess of their opportunity cost of. .. jobs that are appointed by the board of directors è Financial incentives such as stock options è Principles of Corporate Finance Brealey and Myers u Sixth Edition How to Calculate Present Values