Final Syllabus
Fall 2015
Location: Copenhagen
Credits: 3
Faculty: Ole Nyvold
Program Director: Susanne Hovmand, Program Director,
Program Assistant: William Sherman, Program Assistant,
Class: Mondays from 11:40-14:35
Room: F24-206
Description:
Through the study of European cases, this course addresses how companies evaluate their financial status, make choices about debt and equity, and utilize the financial markets. Students will apply corporate finance theory and compare US and European corporate finance practices. Active class participation is essential. It is not a lecture class.
Topics include time value of money, understanding the profit & loss statement and balance sheet, capital structure, debt financing, equity financing, valuation methods, mergers/acquisitions, leveraged buy-outs, stock market ratios, corporate governance and risk management.
Objective:
To analyse and understand major corporate finance issues via corporate case studies.
Business managers today are expected to work within a firm operating around the globe. A cross-border perspective is essential. All areas of major businesses have foreign participation, whether it involves operations, employees, regulators, customers, banks or investors.
The course strives to present major corporate finance issues which companies must deal with. Students will learn how to analyse and interpret company financial information and stock market ratios, appreciate the alternatives for financing a business and become aware of the motivations behind the corporate executives and major players in the financial market.
By reading about actual events and problems among European companies, students will become familiar with not only the theoretical basis of corporate finance, but with the practical problems and multiple consequences of finance decisions.
In addition, the course aims to teach students a methodology for analysing conflicting points of view, formulating decisions despite imperfect information and working together in groups.
Corporate Finance: European Case Studies | DIS

Final Syllabus
Faculty Member:
Ole Nyvold
Master (Accounting & Financial Management, Copenhagen Business School, 1984). Various CFO positions for GN Store Nord in Denmark (1987-1989) & again in Toronto, Canada (1990-1993) as well as for Canon
Business Solutions (1995-2005). CEO for Danish Housing Security (2006-2009) and latest CEO for Basic
Business Consulting Aps (2009-present). 5 years of teaching experience at Copenhagen Business School as external lecturer. With DIS since 2015.
Email:
DIS contacts:
Susanne Hovmand, Program Director,
William Sherman, Program Assistant,
Contents:
The course is divided into 8 cases. Students will study the concepts of capital structure, debt finance, equity finance, company valuation, mergers and acquisitions, corporate governance and risk management.
Students will also be introduced to the major European financial markets and institutions.
Prerequisites:
University-level courses in micro- and macroeconomics as well as an introductory course in finance is necessary.
Requirements:
Classroom environment -
Students will be expected to actively participate in discussion and debate of the cases. Students shall come prepared with their own evaluation and observations to each session, being prepared to both defend their own views as well as contribute constructively to those of others. Students will be required to work in groups.
Grading -
In addition to class participation and casework (60% of the grade), students are expected to take a Midterm Exam (10%) and a Final Exam (30%).
There are 8 cases which require a write-up from each group (consisting of 3-4 students). The write-up is approx. 3 pages of text and summary data presentation as well as 1-2 pages of appendices with raw data and relevant explanatory information. The text shall incorporate a short executive summary, problem formulation, analysis and, if applicable, recommendations.
Course Evaluation:
Corporate Finance: European Case Studies | DIS

Final Syllabus
Cases 40% (8 cases worth 5% each)
Midterm
Final
Participation
10%
30%
20%
Textbook:
Richard A.Brealey, Stewart C. Myers and Franklin Allen, Principles of Corporate Finance, 9 th Ed., McGraw Hill
Irwin, NY, 2008
Relevant Websites: www.fese.be
Federation of European Securities Exchanges www.world-exchanges.org
World Federation of Exchanges www.ecb.int
European Central Bank www.federalreserve.gov
U.S. Federal Reserve System
Note on Use of Electronic Devices in the Classroom:
The use of electronic devices such as laptop computers, mobile phones, tablet devices etc. is discouraged.
Unless I specifically request otherwise, the only acceptable use of such devices is to write notes on classroom material. Students found using electronic devices for other purposes will receive an F for their participation grade.
Attendance – You are expected to attend all DIS classes when scheduled. If you miss two classes the
Director of Teaching and Learning, and the Director of Student Affairs will be notified and they will followup with you to make sure that all is well. Absences will jeopardize your grade and your standing at DIS.
Allowances will be made in cases of illness, but you will need to provide a doctor’s note.
Academic Honesty: Plagiarism and Violating the Rules of an Assignment
DIS expects that students abide by the highest standards of intellectual honesty in all academic work. DIS assumes that all students do their own work and credit all work or thought taken from others. Academic dishonesty will result in a final course grade of “F” and can result in dismissal. The students’ home universities will be notified. DIS reserves the right to request that written student assignments be turned in electronic form for submission to plagiarism detection software. See the Academic Handbook for more information, or ask your instructor if you have questions.
Disability and resource statement: Any student who has a need for accommodation based on the impact of a disability should contact Sean Green () to coordinate this. In order to receive accommodations, students should inform the instructor of approved DIS accommodations within the first two weeks of classes.
Corporate Finance: European Case Studies | DIS

Final Syllabus
Detailed Schedule
Class 1. Monday, August 24
Introduction
What is Corporate Finance?
Looking at the players in the capital market, net present value and internal rate of return
Assignment : Spontaneous case creation. Read the Wall Street Journal and/or the Financial Times from recent days. Pick one or two "stories" which you believe illustrate a corporate finance issue. You shall write one page describing (and be prepared to explain in class): (a) the background, (b) the players involved, (c) the money involved and (d) what aspect of the case is most confusing.
Reading: Brealey & Myers Ch. 2 pp. 48-67, Ch. 3 pp. 73-97, Ch. 5 pp. 129-148
Exercise 1 on financial ratios (group work in class)
Class 2. Monday, August 31

Capital Structure and Accounts
What is capital? What does capital cost? Does capital structure matter?
Looking at Net Present Value vs. IRR; trade-offs between debt and equity; the balance sheet (assets and liabilities); financial ratios
Reading:
Brealey & Myers Ch. 17 pp. 446-462, Ch. 28 pp. 732-752
Note and Worksheet on Financial Ratios (Compendium)
Exercise 2 on financial ratios (prepare parts I and II before class; part III groupwork in class)
Exercise on financial ratios – Group Schneider (to be handed out in class)
Case 1: Novo Nordisk – read latest Annual Report (at www.novonordisk.com)
FIELD STUDY Wednesday, September 2
Class will run from 8:00-app. 10:30
NB! Class starts at 8:00 in classroom BIO 1/Cinema 1 at the DIS Library
FILM

Barbarians at the Gate (Film)
Meet: at the Library, Bio 1
Topic: Private equity and the leveraged buyout
NB: Refreshments will be served
Corporate Finance: European Case Studies | DIS

Final Syllabus
No Class, Core Course Week (September 07-12)
Class 3. Monday, September 14

Debt Financing
What are the advantages of debt? What are the costs of debt? What is a bond’s value?
Looking at financing choices; issuing securities; corporate borrowing theories; types of debt
Reading:
Brealey & Myers Ch. 14 pp. 369-386, Ch. 15 pp. 390-410 , Ch. 24 pp. 625-646
Mystery of Corporate Debt (Compendium)
Choosing the Right Mixture (Compendium)
Worksheet on Interest Rate and Currency Swaps (Compendium)
Case 2: Sound and Belt - excerpt from Medium Term Note Facility memorandum (Compendium)
Case 1 Due
Class 4. Monday, September 21

Equity Financing
What are the advantages of equity? What are the costs of equity?
Reading:
Brealey & Myers Ch. 18 pp. 468-495
“Shares and Shibboleths” (Compendium)
“Post crisis flaws are to blame for slump in IPO’s” (Compendium)
“Fiscal cliff spurs record number of special dividends” (DIS Forum)
Case 3: Rosario Acero (DIS Forum)
Case 2 Due
No class, DIS Program Study Tours or Travel Break (September 26-October 04)
Class 5. Monday, October 05

Company Valuation
How do we value the firm? What are the relevant financial ratios?
Looking at valuing bonds and stocks; NPV and valuation of the firm; analysing the financial condition of the firm; asset/earnings/cashflow models
Reading:
Brealey & Myers Ch 4 pp. 102-148, Ch 19 pp.499-521
Valuation Techniques (Compendium)
Case 4: TBA
Case 3 Due
Class 6. Monday, October 12
More on company valuation; Preparation for Midterm Exam
Reading:
Review Note on Financial Ratios (Compendium)
Midterm Exam
No Class, DIS Program Study Tours or Travel Break (October 17-25)
Class 7. Monday, October 26
Corporate Finance: European Case Studies | DIS

Final Syllabus

Financial markets and institutions
Are financial exchanges (i.e. market venues) just a business? What is purpose of a prospectus and of
“fairness” opinions?
Looking at consolidation of players; harmonization of infrastructure; the purpose of regulation
Reading:
“Buy, buy, buy” (Compendium)
“A Market to Capture” and “Battle is on to Make Bond Market more Transparent” (DIS Forum)
Case 5: Nasdaq-OMX – excerpt from Nasdaq Offer Document for OMX (DIS Forum)
Case 4 Due
Class 8. Monday, November 02

Mergers and Acquisitions
Why do firms merge? What is a LBO? What are the rules and tactics? What is “due diligence”?
Looking at mergers and corporate re-structuring
Reading:
Brealey & Myers Ch. 31 pp. 820-841, Ch 32 pp. 852-873
Articles concerning HP and Autonomy acquisition (Compendium)
Case 6: Nestle-Rowntree (DIS Forum)
Case 5 Due
No class, DIS Travel Break (November 07-15)
Class 9. Monday, November 16

Corporate Governance
Why is corporate governance important? What is “best practice”, “conflicts of interest”, “transparency”,
“management incentive”?
Looking at governance and corporate control
Reading:
Brealey & Myers Ch 1 pp. 29-44, Ch 33 pp. 878-896
“Creative Construction” article (Compendium)
“A model for healthier profits” article (Compendium)
“Model Management” and “Shareholder Democracy” (DIS Forum)
Case 7: Yukos Oil (DIS Forum);
Case 6 Due
FIELD STUDY - Workshop
13:00-17:00
more info will follow leading up to
Classroom: regular F24-206
Class 10. Monday, November 23

Risk Management
What kind of risks exist in financial markets? How do we measure risk? How do we protect against risk?
Why are banks different?
Looking at VAR and stress testing, Beta, market/credit/operational risk
Reading:
Brealey & Myers Ch. 7 pp. 184-207
Corporate Finance: European Case Studies | DIS

“Turmoil in the Financial Markets” (Compendium)
Case 8: Bear Stearns – excerpt from 2006 Annual Report (Compendium)
Case 7 Due
Class 11. Monday, November 30

Consolidating Global Presence

Discussion of Final Exam case

Semester Wrap Up
What is the role of corporate finance in a large MNC?
Looking at financial budgeting. What is funding need? What are financing alternatives?
Reading:
“Yankee Bonds” (Compendium)
Case: Hutchinson Whampoa (preparation for final)
Case 8 Due
Final Exam Case : GN Great Nordic (DIS Forum)
Final Syllabus
Final Exam, Wednesday, December 9
12:00-14:00
2-hour written exam (individual)
Classroom: TBA
Corporate Finance: European Case Studies | DIS