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Unit information: Advanced Corporate Finance in 2020/21

Please note: you are viewing unit and programme information for a past academic year. Please see the current academic year for up to date information.

Unit name Advanced Corporate Finance
Unit code EFIM30020
Credit points 10
Level of study H/6
Teaching block(s) Teaching Block 2 (weeks 13 - 24)
Unit director Professor. Ozkan
Open unit status Not open
Pre-requisites

Corporate Finance (EFIM20006)

Co-requisites

Financial Markets (EFIM30019)

School/department School of Accounting and Finance
Faculty Faculty of Social Sciences and Law

Description

This module covers advanced topics on corporate financing decision and how information asymmetry and conflicts of interests among various claimants influence corporate policies. Topics covered include optimal capital structure, financial distress, share repurchases, initial public offerings (IPOs), interaction of corporate strategy and financing, corporate governance, mergers and acquisitions, and real options.

Intended learning outcomes

On successful completion of this unit a student will be able to:

  • understand how firms make decisions on their capital structure considering information asymmetry and conflicts of interests among various claimants.
  • understand how firms decide whether they should do share repurchase or pay dividends.
  • Understand which factors influence mergers and acquisitions decisions.
  • Understand how corporate governance mechanisms can influence mergers and acquisitions.
  • Understand which factors explain IPO underpricing.
  • Understand how firms use real options in evaluating projects.

Teaching details

Teaching will be delivered through a combination of synchronous and asynchronous sessions including lectures, tutorials, drop-in sessions, discussion boards and other online learning opportunities

Assessment Details

This unit will be assessed by 100% coursework

Reading and References

Financial Markets and Corporate Strategy, European edition, David Hillier, Mark Grinblatt, Sheridan Titman, McGraw Hill Irwin.

Corporate Finance, European edition, David Hillier, Stephen A. Ross, Randolph W. Westerfield, Jeffrey Jaffe, Bradford Jordan, Mc Graw Hill Irwin.

Indicative Journal articles for tutorials:

  1. “Managerial Entrenchment and Capital Structure Decisions”, P.G. Berger,E. Ofek, D.L. Yermack. Journal of Finance (1997).
  2. Macroeconomic conditions and capital raising”, Erel et al., Review of Financial Studies (2012).3) Agency costs of free cash flow” Jensen, M., American Economic Review (1986).
  3. “World markets for raising new capital” Weisbach et al., Journal of Financial Economics (2006)
  4. “The theory and practice of corporate finance: evidence from the field”, Journal of Financial Economics (2001), J. Graham and C. Harvey.
  5. Corporate innovations and mergers and acquisitions”, Bena and Li, Journal of Finance (2014).
  6. The mystery of zero-leverage firms”, Ilya A.Strebulaev, BaozhongYang, Journal of Financial Economics (2013).

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