Practical Guide to Mergers, Acquisitions, and Divestitures
Mergers and acquisitions (M&A), driven by globalization, long-term markets, and various barriers to growth, often result in new organizations whose financial and strategic options are much improved. Thus, mergers and acquisitions can be a valuable tool by which companies can quickly attempt to increase revenue. This course discusses all facets of M&A and divestitures, such as types, structures, the process, valuation methods, tax implications, essential compliance requirements (e.g. SEC filing, accounting rules), and financial analysis of combinations.
Course Information
Price: $59
Course No. 7088
Format: Online pdf (147 pages). Printed book available.
Author: Delta CPE LLC
Prerequisites: None
Advance Preparation: None
Level: Overview
CPE Credit: 6 hrs.
Field of Study: Finance: Technical
Course expiration: You have one year from date of purchase to complete the course.
Course Revision Date: February 2023
Objectives
After studying this course, you should be able to:
- Identify the characteristics of mergers
- Identify the different types of mergers
- Recognize the benefits of mergers
- Identify antitrust guidelines used by the Justice Department
- Recognize Securities and Exchange Commission (SEC) rules regarding mergers
- Recognize different defensive measures used by target companies
- Identify advantages and disadvantage of different methods of financing a merger
- Recognize how different mergers may affect taxation and financial results
- Recognize how to account for transactions under the acquisition metho
- Identify different approaches and techniques for merger valuation
- Identify different types of divestitures and methods used to divest
Course Contents
Chapter 1: Mergers and Acquisitions
Key Concepts
Characteristics of Mergers
Types of Mergers
Five-Step Process
Factors to Consider
Pros and Cons of a Merger
Types of Takeover Bids
Herfindahl-Hirshman Index
The Mergers and Acquisitions Process
Setting Strategy
Identifying Target Companies
Performing Due Diligence Analysis
Determining Bid Prices
Financing the Merger
Use of Capital Budgeting
The Impact of a Merger
Defense Strategies Against Takeovers
Other Matters
Acquisition Risks
Tax Implications
Financial Statement Analysis
Emergence of Corporate Development Officers and M&A Teams
Target Company Valuation
Overview
Valuation Methods
Comprehensive Illustration: Target Company Valuation and Discounted Cash Flow
Accounting for Business Combinations
General Rules
Definition of a Business
Acquisition Method
Disclosure Requirements
Chapter 2: Divestiture
Key Concepts
Importance of Divestiture
Types of Divestitures
The Divestiture Process
Candidate for Divestiture
Reasons to Divest
Factors to Consider
Human Capital Matters
Valuation Methods
Asset Valuation Methods
Sales and Income Factors
Market Based Comparisons
Discounted Cash Flow Analysis
Adjusting for Uncertainty
Comprehensive Illustration: Divestiture Valuation and Discounted Cash Flow
Tax Implications
Cash vs. “Paper”
Installment Sales
Leveraged Buyouts
Other Matters
Accounting for Divestitures
Disclosure Requirements for Discontinued Operations
Other Matters
Subsidiaries Sold to the Public or Spun Off (Carveout Accounting)
Liquidation Process
Appendix A: Due Diligence Checklist
Appendix B: Legal Procedure
Appendix C: Acquisition Disclosure
Appendix D: Present Value of $1 Tabe
Appendix E: Present Value of an Annuity of $1 Table
