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The aim of the course is to explore the increasingly important and detailed intersection of the fields of corporate finance and corporate law, particularly in the domains of mergers and acquisitions, securities litigation, and shareholder litigation. In each of these domains, finance and law have begun to lean heavily upon one another. Part of the reason for this growth has been due to the greater focus and expertise that financial economists have developed since the 1980s and 1990s to answer “real world” problems of legal significance. Another part is due to the greater emphasis that both courts and regulators now place on finance methodologies pertaining to valuation, transactional fairness, market dynamics, and the ability to quantify as well as spread risks.
The course is appropriate for advanced law students. We will heavily rely on an understanding of core principles from finance and corporate finance and discuss advanced topics that are indispensable for each aspiring corporate, mergers and acquisitions, or financial markets lawyer. Therefore, the course requires participation in both “Principles of Personal Finance for Lawyers” and “Business and Managerial Finance”. Moreover, students should be comfortable with working with numbers (including algebra and some basic calculus). Some experience with basic and intermediate statistics may also be helpful, but is also not required. The basic text for the course will be Hiller, Grinblatt & Titman, “Financial Markets and Corporate Strategy: European Edition” (2nd edition 2011). Note that this text is far from being a soft and fuzzy textbook, even by MBA standards, but it gives and excellent treatment to the topics we will be covering. For this reason, Welch, “A First Course in Corporate Finance” (1st edition 2006) will accompany the course as an alternative main textbook. Key Learning Goals: The overarching learning objective of the course is to provide students with knowledge and skills in understanding and taking corporate financial investment decisions, apply analytical instruments to assess the effectiveness of such decisions, and elaborate models corporate financial management. By the end of the course, students should be able to: − explain and be able to communicate the nature of corporate finance in an academic of business context − distinguish different types of business structure, identify the major corporate financial decisions and corporate objective, and describe some important basic concepts − be able to perform time-value calculations by using financial mathematics − explain how to value a firm and apply skills in evaluating debt and equity securities − explain the nature of interest rate risk and describe the theories that are used to explain the term structure of interest rates − apply skills in evaluating capital budgeting projects by using different methods of project evaluation − apply skills in risk and return measurement − describe basic portfolio theory and communicate more effectively in an academic or business context − apply the Capital Asset Pricing Model and apply skills in estimating the cost of equity − estimate the cost of each source of capital and combine these costs into a weighted average costs of capital for a company − understand capital structure and outline the main factors that financial managers should consider when determining a firm’s financing strategy − critically apply and discuss the theories detailing the capital structure as well as assess the implications of empirical evidence from recent studies on capital structure − critically apply and discuss the theories relating dividends to share price and cost of capital − describe the concept of market efficiency and distinguish between different categories of market efficiency As students should gain a deep understanding of how some of the advanced concepts work, this course features practical seminars. Students are required to work on problem sets at home. Solutions are presented by students and extensions are discussed in class. Poslední úprava: Šicnerová Barbora, Mgr. (05.08.2024)
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The course finishes with a final exam. The exam counts 60% towards the final grade. For their work in the practical seminars, their presentations, and quizzes, students earn another 40% towards their final grade. Poslední úprava: Šicnerová Barbora, Mgr. (05.08.2024)
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The course includes the following topics: 1. Raising Capital, Capital Structure, Rights of Capital Claimants 2. Discounting and Valuation 3. Financial Accounting --- Financial Valuation I: Basics (this is a requirement) --- 4. Financial Valuation II: Portfolio Theory & Capital Asset Pricing Model 5. Financial Valuation III: Arbitrage Pricing Theory and Factor Models 6. Pricing Derivatives and Options: Binomial and Black & Scholes Models 7. Valuation of Risky Projects and Firms 8. Capital Budgeting, i.e., evaluation of investment projects 9. Understanding the Roles of Taxes in Capital Decisions and Structure 10. Managerial Incentives and Compensation 11. Insider Trading 12. Mergers and Acquisitions 13. Putting Finance to Work for Lawyers and Policy Makers: Event Studies
The course includes the following topics: 1. Raising Capital, Capital Structure, Rights of Capital Claimants 2. Discounting and Valuation 3. Financial Accounting --- Financial Valuation I: Basics (this is a requirement) --- 4. Financial Valuation II: Portfolio Theory & Capital Asset Pricing Model 5. Financial Valuation III: Arbitrage Pricing Theory and Factor Models 6. Pricing Derivatives and Options: Binomial and Black & Scholes Models 7. Valuation of Risky Projects and Firms 8. Capital Budgeting, i.e., evaluation of investment projects 9. Understanding the Roles of Taxes in Capital Decisions and Structure 10. Managerial Incentives and Compensation 11. Insider Trading 12. Mergers and Acquisitions 13. Putting Finance to Work for Lawyers and Policy Makers: Event Studies
Poslední úprava: Šicnerová Barbora, Mgr. (05.08.2024)
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Základní literatura: 1. Hiller, D., Grinblatt, D. Titman, S. Financial Markets and Corporate Strategy: European Edition. McGraw-Hill Education, 2nd edition 2011. 2. Welch, I. A First Course in Corporate Finance, 1st edition 2006. Poslední úprava: Šicnerová Barbora, Mgr. (05.08.2024)
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Pro zápis předmětu je vhodné, aby student měl absolvován nebo alespoň zapsán předmět Právo a ekonomie I. Poslední úprava: Šicnerová Barbora, Mgr. (05.08.2024)
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