5122 - CORPORATE FINANCE

The course explores investing and financing decisions, focusing on their role in the creation of value for shareholders. Corporate applications of financial theories are thoroughly examined from both financial policies and financial management stanpoints. The course provides an introduction to the operative functions of the Chief Financial Officer and the Corporate Treasurer. The program consists of the following six modules: 1) Objectives, functions and instruments of corporate finance; 2) Instruments for financial analysis and planning; 3) Market risk and return of securities; 4) Capital budgeting; 5) Corporate financial structure and dividend policies; 6) Capital market financing and risk management.

1. The role of the financial manager and the net present value rule
2. Using present value formulas to value bonds and equity
3. Financial analysis, planning and short term planning
4. Risk, return and the opportunity cost of capital
5. Capital asset pricing model
6. Estimating cash flows and investment decisions with the net present value rule
7. Capital budgeting and risk: measuring betas and the company cost of capital
8. MM theory, costs of financial distress and pecking order theory
9. Making capital structure decisions
10. Dividends and share repurchase
11. Issuing securities, fixed income financing and hybrid financing
12. Managing financial risks

• To be defined at the beginning of the course

Attending students
Students may take a mid term examination and then a final examination. To pass the exam the student must obtain at least a mark of 18 in each of the two written examinations. In this case the average of the two marks, which will be rounded up, will be registered.
Non attending students
The exam is written.