财务管理基础全套配套课件沈洪涛 ch21.ppt

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1、CHAPTER21MergersandDivestituresTypesofmergersMergeranalysisRoleofinvestmentbankersCorporatealliancesLBOs,divestitures,andholdingcompaniesWhydomergersoccur?Synergy:Valueofthewholeexceedssumoftheparts.Couldarisefrom:OperatingeconomiesFinancialeconomiesDifferentia

2、lmanagementefficiencyIncreasedmarketpowerTaxes(useaccumulatedlosses)Break-upvalue:Assetswouldbemorevaluableifsoldtosomeothercompany.Whataresomequestionablereasonsformergers?DiversificationPurchaseofassetsatbelowreplacementcostGetbiggerusingdebt-financedmergerst

3、ohelpfightofftakeoversWhatisthedifferencebetweena“friendly”anda“hostile”takeover?Friendlymerger:Themergerissupportedbythemanagementsofbothfirms.Hostilemerger:Targetfirm’smanagementresiststhemerger.Acquirermustgodirectlytothetargetfirm’sstockholderstrytoget51%to

4、tendertheirshares.Often,mergersthatstartouthostileendupasfriendlywhenofferpriceisraised.ReasonswhyalliancescanmakemoresensethanacquisitionsAccesstonewmarketsandtechnologiesMultiplepartiessharerisksandexpensesRivalscanoftenworktogetherharmoniouslyAntitrustlawsca

5、nsheltercooperativeR&DactivitiesMergeranalysis:Post-mergercashflowstatements2003200420052006Netsales$60.0$90.0$112.5$127.5-Costofgoodssold36.054.067.576.5-Selling/admin.exp.4.56.07.59.0-Interestexpense3.04.54.56.0EBT16.525.533.036.0-Taxes6.610.213.214.4NetInco

6、me9.915.319.821.6Retentions0.07.56.04.5Cashflow9.97.813.817.1Whatistheappropriatediscountratetoapplytothetarget’scashflows?Estimatedcashflowsareresidualswhichbelongtoacquirer’sshareholders.Theyareriskierthanthetypicalcapitalbudgetingcashflows.Becausefixedintere

7、stchargesarededucted,thisincreasesthevolatilityoftheresidualcashflows.Becausethecashflowsareriskyequityflows,theyshouldbediscountedusingthecostofequityratherthantheWACC.Discountingthetarget’scashflowsThecashflowsreflectthetarget’sbusinessrisk,nottheacquiringcom

8、pany’s.However,themergerwillaffectthetarget’sleverageandtaxrate,henceitsfinancialrisk.CalculatingterminalvalueFindtheappropriatediscountratekS(Target)=kRF+(kM–kRF)βTarget=9%