Corporate Financial Reorganization and Management

Introduction:

Corporate Financial Restructuring involves a set of measures aimed at altering the economic and financial structure of a company to enhance stakeholder value.

While stakeholder value is often appreciated, certain conditions and necessary changes must be understood to prevent a decrease in value. This financial restructuring course is designed to equip participants with the knowledge and skills needed to navigate such situations.

In this course, we explore the multifaceted nature of corporate and financial restructuring, focusing on addressing these challenges within the current business landscape.

Participants will gain a deep understanding of financial restructuring and its limitations compared to operational restructuring. They will also be provided with the tools and frameworks necessary for sound decision-making in practical contexts.

Objectives:

After completing this financial restructuring course, participants will:

• Develop a comprehensive understanding of various forms of restructuring.
• Clarify distinctions between corporate restructuring and financial restructuring.
• Analyze the strategic implications of acquisitions and divestitures on operating units.
• Create effective measures for valuing firms or business units.
• Examine approaches for leveraging and deleveraging.
• Identify the relative merits and drawbacks of different corporate and financial restructuring strategies.
• Consider the advantages and disadvantages of leverage.
• Determine the operational value of a company.
• Analyze the pros and cons of divestiture.
• Enhance their knowledge through restructuring modeling.
• Improve analytical skills using Excel® models.

Training Methodology:

• Interactive lectures
• Case studies
• modeling sessions
• Group discussions
• Financial simulations
• Financial modeling games
• case studies

Course Outline:

Unit 1: Understanding Restructuring Modeling

• Introduction to components and dynamics of restructuring modeling
• Restructuring modeling framework
• Constructing a plan for restructuring before it becomes necessary
• Strategic risk management: Planning for restructuring to avoid it
• Restructuring in crisis and chronic situations
• Participants in restructuring modeling activities
• Perspectives of creditors, shareholders, and employees

Unit 2: The Why and How of Restructuring Modeling

• Reasons for corporate restructuring modeling
• Timing and necessity of corporate reorganization
• Planning and executing corporate restructuring
• Success factors in restructuring modeling
• Value assessment of firms in different scenarios
• Strategic partnerships vs. acquisitions
• Pros and cons of leverage

Unit 3: Valuation in Corporate Restructuring

• Overview of valuation in corporate restructuring
• Techniques for accurate valuation in financial restructuring
• Determining liquidation values in financial restructuring
• Methods based on asset approach and market comparables
• Free cash flow analysis: FCF to firm and FCF to equity
• Techniques of option value

Unit 4: Leverage in Financial Restructuring

• Effects of leverage and deleverage decisions
• Rate of return and cost adjustments for debt and equity
• Optimization of capital structure and bond buyback strategies
• Leveraged Buy-Outs (LBOs)
• Going private: Costs and benefits
• Assessment of debt capacity
• Decision-making using Excel models

Unit 5: Divestitures in Corporate Financial Management

• Reasons for divesting a business unit
• Comparison of divestiture with alternative actions
• Analysis of divestiture, spin-offs, and equity carve-outs
• Strategic voluntary liquidations
• Excel models for decision-making

Conclusion:

This course in Corporate Financial Restructuring equips participants with advanced knowledge of corporate and financial accounting principles, techniques in restructuring modeling, and practical skills that can be applied directly in the business world. It extends the prospects of corporate financial management and restructuring, whether for individuals or financial management corporations.