KOÇ UNIVERSITY
COLLEGE OF ADMINISTRATIVE SCIENCES AND ECONOMICS
CORPORATE FINANCE (MFIN 301)
SYLLABUS
SPRING 2014
Prof. Oguzhan Ozbas
Course objective: The objective of this course is for you to learn the financial tools
needed to make good business decisions. The emphasis will be on linking finance to
other aspects of corporate strategy.
Teaching methods: The course will build on corporate finance theory with applications
to real business decisions. Each session will involve class discussion. In some instances,
discussion will be centered on lectures; in others, it will be centered on a business case.
As opportunities arise, we will discuss current events in the world of corporate finance.
Your participation is critical to the success of the course. You are expected to study all
cases and readings, come to class, and participate in class discussion.
Prerequisite: Introduction to Financial Management (MFIN 202)
Course Material:
 Lecture notes and other additional course materials will be posted on KUAIS
 Brealy, Myers and Marcus (BMM), Fundamentals of Corporate Finance, 7th
edition, McGraw-Hill
Requirements/Grading:
 Class Participation: 10%
 Case Write-ups: 30%
 Valuation Project: 20%
 Final: 40% (open-book)
Case Write-ups: You should form groups of 4-5 students, and hand-in a single write-up
per team. Except for two cases of your choice, teams are required to hand in all write-ups.
If more write-ups are handed in, only the best ones will count.
Your write-ups, which summarize your analysis and recommendations, must not exceed
two pages of reasonably sized text (at least 11 points, and preferably double-spaced).
Supporting appendices should be concise and clear.
Contact Information: email oozbas@ku.edu.tr – office (212) 338-1190
Institute Policy regarding Academic Integrity: The following is from the Teaching
Guide, Koç University College of Administrative Sciences and Economics:
“Honesty and trust are important to all of us as individuals. Students and faculty adhere to
the following principles of academic honesty at Koç University:

Individual accountability for all individual work, written or oral: Copying from
others or providing answers and information, written or oral, to others is cheating.

Proper acknowledgment of original author: Copying from another student’s paper
or from another text without written acknowledgment is plagiarism.

Study of group project activity is effective and authorized teamwork:
Unauthorized help from another person or having someone else write one’s paper
or assignment is collusion.
Cheating, plagiarism, and collusion are serious offenses resulting in an F grade and
disciplinary action.”
SCHEDULE
Part I: Financing
Objective: The aim of this part of the course is to develop a framework to think about
how firms finance their operations and how this interacts with overall corporate strategy.
Session #1 – Monday, February 3
Introduction
 For background, you may want to read again:
o BMM, Chapter 3: “Accounting and Finance”
o BMM, Chapter 4: “Measuring Corporate Performance”
Session #2 – Wednesday, February 5
Case Study: Butler Lumber Company (Session I)
 Reading: BMM, Chapter 18: “Long-Term Financial Planning”
Session #3 – Monday, February 10
Case Study: Butler Lumber Company (Session II)
Session #4 – Wednesday, February 12
Case Study: Butler Lumber Company (Session III)
Session #5 – Monday, February 17
Lecture: Capital Structure
Session #6 – Wednesday, February 19
Lecture: Capital Structure (continued)
Session #7 – Monday, February 24
Lecture: Capital Structure (continued)
Session #8 – Wednesday, February 26
Case Study: UST Inc. (Session I)
Session #9 – Monday, March 3
Case Study: UST Inc. (Session II)
Session #10 – Wednesday, March 5
Case Study: Massey-Ferguson, 1980 (Session I)
Session #11 – Monday, March 10
Case Study: Massey-Ferguson, 1980 (Session II)
Wednesday, March 12 – No class
Session #12 – Monday, March 17
Lecture: Capital Structure: Informational and Dynamic Considerations
Session #13 – Wednesday, March 19
Lecture: Capital Structure: Informational and Dynamic Considerations (continued)
Session #14 – Monday, March 24
Case Study: MCI Communications Corp., 1983
Session #15 – Wednesday, March 26
Lecture: Risk Management
 Reading: Froot, Scharfstein and Stein, “A Framework for Risk Management,”
Harvard Business Review, 1994
PART II: Valuation and Investment
Objective: The aim of this part of the course is to develop tools to evaluate real
investment opportunities, such as building a new plant or acquiring another company.
Session #16 – Monday, March 31
Lecture: Free Cash Flows
Session #17 – Wednesday, April 2
Case Study: Sky Television versus British Satellite Broadcasting
Monday, April 7 – Spring Break
Wednesday, April 9 – Spring Break
Session #18 – Monday, April 14
Lecture: WACC
Session #19 – Wednesday, April 16
Lecture: APV
 Reading: Luehrman, “Using APV: A Better Tool for Valuing Operations,”
Harvard Business Review, 1997
Session #20 – Monday, April 21
Case Study: Dixon Corporation: The Collinsville Plant (Session I)
Wednesday, April 23 – National Sovereignty and Children’s Day
Session #21 – Monday, April 28
Case Study: Dixon Corporation: The Collinsville Plant (Session II)
Session #22 – Wednesday, April 30
Case Study: Dixon Corporation: The Collinsville Plant (Session III)
Session #23 – Monday, May 5
Lecture: Valuing a Company
Session #24 – Wednesday, May 7
Case Study: The Southland Corporation (A)
Session #25 – Monday, May 12
Case Study: Radio One, Inc.
Session #26 – Wednesday, May 14
Sample Final Exam
VALUATION PROJECT: Friday, May 16
FINAL EXAM: University scheduled day and time