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Mergers, Acquisitions, and Other Restructuring Activities
An Integrated Approach to Process, Tools, Cases, and Solutions
- 5th Edition - September 22, 2009
- Author: Donald DePamphilis
- Language: English
- eBook ISBN:9 7 8 - 0 - 0 8 - 0 9 5 2 0 5 - 5
In the fifth edition of this well-known text, Dr. DePamphilis explains the real world of mergers, acquisitions, and restructuring based on his academic knowledge and personal… Read more
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Request a sales quoteIn the fifth edition of this well-known text, Dr. DePamphilis explains the real world of mergers, acquisitions, and restructuring based on his academic knowledge and personal experiences with over 30 such deals himself. Important enhancements unique to the fifth edition: all 99 cases involve real-life deals made or announced within the last five years, extensive discussions of all current valuation techniques and their strengths and weaknesses, cross-border transactions analyzed and explained in detail, tax and legal issues covered comprehensively.
- Focuses on the REAL WORLD, not just theory. The 99 case studies span every industry and dozens of countries and show how deals are done rather than just the theory behind them. All cases fully updated for this edition. Cases all involve transactions that have occurred or been announced within the past 3-5 years.
- Extensive updating and enhanced content provided on reorganization, bankruptcy, and liquidation issues both inside and outside of bankruptcy court
MBA and advanced undergraduate and graduate Finance students taking courses in: Mergers & Acquisitions, corporate restructuring, corporate strategy
Part I: The Mergers and Acquisitions Environment
Chapter 1: Introduction to Mergers and Acquisitions (M&As)
Inside M&A: Mars Buys Wrigley in One Sweet Deal
Chapter Overview
Mergers and Acquisitions as Change Agents
Common Motivations for Mergers and Acquisitions
Merger and Acquisition Waves
Alternative Forms of Corporate Restructuring
Friendly versus Hostile Takeovers
The Role of Holding Companies in Mergers and Acquisitions
The Role of Employee Stock Ownership Plans in Mergers and Acquisitions
Business Alliances as Alternatives to Mergers and Acquisitions
Participants in the Mergers and Acquisitions Process
Do Mergers and Acquisitions Pay Off for Shareholders
Do Mergers and Acquisitions Pay Off for Bondholders
Do Mergers and Acquisitions Pay Off for Society
Commonly Cited Reasons Why Some Mergers and Acquisitions Fail to Meet Expectations
Long-Term Performance Similar for Mergers and Acquisitions, Business Alliances, and Solo Ventures
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Chapter 2: Regulatory Considerations
Inside M&A: Justice Department Approves Maytag/Whirlpool Combination Despite Resulting Increase in Concentration
Chapter Overview
Federal Securities Laws
Antitrust Laws
State Regulations Affecting Mergers and Acquisitions
National Security–Related Restrictions on Direct Foreign Investment in the United States
Foreign Corrupt Practices Act
Regulated Industries
Environmental Laws
Labor and Benefit Laws
Cross-Border Transactions
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Chapter 3: The Corporate Takeover Market: Common Takeover Tactics, Antitakeover Defenses, and Corporate Governance
Inside M&A: InBev Buys an American Icon for $52 Billion
Chapter Overview
Factors Affecting Corporate Governance
Alternative Takeover Tactics in the Corporate Takeover Market
Developing a Bidding or Takeover Strategy Decision Tree
Alternative Takeover Defenses in the Corporate Takeover Market
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Part II: The Mergers and Acquisitions Process: Phases 1–10
Chapter 4: Planning: Developing Business and Acquisition Plans—Phases 1 and 2 of the Acquisition Process
Inside M&A: Nokia Moves to Establish Industry Standards
Chapter Overview
A Planning-Based Approach to Mergers and Acquisitions
Phase 1. Building the Business Plan
The Business Plan as a Communication Document
Phase 2. Building the Merger–Acquisition Implementation Plan
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Appendix: Common Sources of Economic, Industry, and Market Data
Chapter 5: Implementation: Search through Closing—Phases 3–10
Inside M&A: Bank of America Acquires Merrill Lynch
Chapter Overview
Phase 3. The Search Process
Phase 4. The Screening Process
Phase 5. First Contact
Phase 6. Negotiation
Phase 7. Developing the Integration Plan
Phase 8. Closing
Phase 9. Implementing Postclosing Integration
Phase 10. Conducting a Postclosing Evaluation
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Appendix: Legal Due Diligence Preliminary Information Request
Chapter 6: Integration Mergers, Acquisitions, and Business Alliances
Inside M&A: GE’s Water Business Fails to Meet Expectations
Chapter Overview
The Role of Integration in Successful Mergers and Acquisitions
Viewing Integration as a Process
Integrating Business Alliances
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Part III: Merger and Acquisition Valuation and Modeling
Chapter 7: A Primer on Merger and Acquisition Cash-Flow Valuation
Inside M&A: The Importance of Distinguishing between Operating and Nonoperating Assets
Chapter Overview
Required Returns
Analyzing Risk
Calculating Free Cash Flows (D/E)
Applying Income or Discounted Cash-Flow Methods
Valuing Firms under Special Situations
Valuing a Firm’s Debt and Other Obligations
Valuing Nonoperating Assets
Adjusting the Target Firm’s Equity Value for Nonoperating Assets, Debt, and Other Obligations
Things to Remember
Chapter Discussion Questions
Chapter Practice Problems and Answers
Chapter Business Cases
Chapter 8: Applying Relative, Asset-Oriented, and Real-Option Valuation Methods to Mergers and Acquisitions
Inside M&A: A Real Options’ Perspective on Microsoft’s Takeover Attempt of Yahoo
Chapter Overview
Applying Relative-Valuation (Market-Based) Methods
Applying Asset-Oriented Methods
Replacement-Cost Method
Valuing the Firm Using the Weighted-Average (Expected-Value) Method
Analyzing Mergers and Acquisitions in Terms of Real Options
Determining When to Use the Different Approaches to Valuation
Things to Remember
Chapter Discussion Questions
Chapter Practice Problems and Answers
Chapter Business Cases
Chapter 9: Applying Financial Modeling Techniques to Value, Structure, and Negotiate Mergers and Acquisitions
Inside M&A: HP Buys EDS—The Role of Financial Models in Decision Making
Chapter Overview
Limitations of Financial Data
Model-Building Process
Adjusting the Target’s Offer Price for the Effects of Options and Convertible Securities
Factors Affecting Postmerger Share Price
Key M&A Model Formulas
M&A Model Balance-Sheet Adjustment Mechanisms
Applying Offer Price-Simulation Models in the Context of M&A Negotiations
Alternative Applications of M&A Financial Models
Things to Remember
Chapter Discussion Questions
Chapter Practice Problems and Answers
Chapter Business Cases
Chapter 10: Analysis and Valuation of Privately Held Companies
Inside M&A: Cashing Out of a Privately Owned Enterprise1
Chapter Overview
Demographics of Privately Owned Businesses
Challenges of Valuing Privately Held Companies
Process for Valuing Privately Held Businesses
Step 1. Adjusting the Income Statement
Step 2. Applying Valuation Methodologies to Private Companies
Step 3. Developing Discount (Capitalization) Rates
Step 4. Applying Liquidity Discounts, Control Premiums, and Minority Discounts
Reverse Mergers
Using Leveraged Employee Stock Ownership Plans to Buy Private Companies
Empirical Studies of Shareholder Returns
Things to Remember
Chapter Discussion Questions
Chapter Practice Problems and Answers
Chapter Business Cases
Part IV: Deal Structuring and Financing Strategies
Chapter 11: Structuring the Deal: Payment and Legal Considerations
Inside M&A: News Corp’s Power Play in Satellite Broadcasting Seems to Confuse Investors
Chapter Overview
The Deal-Structuring Process
Form of Acquisition Vehicle
Postclosing Organization
Legal Form of the Selling Entity
Form of Payment or Total Consideration
Managing Risk and Closing the Gap on Price
Using Collar Arrangements (Fixed and Variable) to Preserve Shareholder Value
Form of Acquisition
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Chapter 12: Structuring the Deal: Tax and Accounting Considerations
Inside M&A: Teva Pharmaceuticals Acquires Ivax Corp
Chapter Overview
General Tax Considerations
Taxable Transactions
Tax-Free Transactions
Other Tax Considerations Affecting Corporate Restructuring Activities
Financial Reporting of Business Combinations
Impact of Purchase Accounting on Financial Statements
International Accounting Standards
Recapitalization Accounting
Things to Remember
Chapter Discussion Questions
Chapter Practice Problems and Answers
Chapter Business Cases
Chapter 13: Financing Transactions: Private Equity, Hedge Funds, and Leveraged Buyout Structures and Valuation
Inside M&A: HCA’s LBO Represents a High-Risk Bet on Growth
Chapter Overview
Characterizing Leveraged Buyouts
When Do Firms Go Private?
Financing Transactions
Common Forms of Leveraged Buyout Deal Structures
What Factors Are Critical to Successful LBOs?
Knowing What to Buy
Prebuyout and Postbuyout Shareholder Returns
Valuing Leveraged Buyouts
Building an LBO Model
Typical LBO Model Formats
Estimating Borrowing Capacity
Things to Remember
Chapter Discussion Questions
Chapter Practice Problems
Chapter Business Cases
Part V: Alternative Business and Restructuring Strategies
Chapter 14: Joint Ventures, Partnerships, Strategic Alliances, and Licensing
Inside M&A: Garmin Utilizes Supply Agreement as Alternative to Acquiring Tele Atlas
Chapter Overview
Motivations for Business Alliances
Critical Success Factors for Business Alliances
Alternative Legal Forms of Business Alliances
Strategic and Operational Plans
Resolving Business Alliance Deal-Structuring Issues
Empirical Findings
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Chapter 15: Alternative Exit and Restructuring Strategies: Divestitures, Spin-Offs, Carve-Outs, Split-Ups, and Split-Offs
Inside M&A. Financial Services Firms Streamline their Operations
Chapter Overview
Commonly Stated Motives for Exiting Businesses
Divestitures
Spin-offs and Split-Ups
Equity Carve-Outs
Split-Offs
Voluntary Liquidations (Bust-Ups)
Tracking, Targeted, and Letter Stocks
Comparing Alternative Exit and Restructuring Strategies
Choosing among Divestiture, Carve-out, and Spin-off Restructuring Strategies
Determinants of Returns to Shareholders Resulting from Restructuring Strategies
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Chapter 16: Alternative Exit and Restructuring Strategies: Reorganization and Liquidation
Inside M&A: Calpine Emerges from the Protection of Bankruptcy Court
Chapter Overview
Business Failure
Voluntary Settlements with Creditors outside of Bankruptcy
Reorganization and Liquidation in Bankruptcy
Analyzing Strategic Options for Failing Firms
Predicting Corporate Default and Bankruptcy
Empirical Studies of Financial Distress
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
Chapter 17: Cross-Border Mergers and Acquisitions: Analysis and Valuation
Inside M&A: Arcelor Outbids ThyssenKrupp for Canada’s Dofasco Steelmaking Operations
Chapter Overview
Distinguishing between Developed and Emerging Economies
Globally Integrated versus Segmented Capital Markets
Motives for International Expansion
Common International Market Entry Strategies
Structuring Cross-Border Transactions
Financing Cross-Border Transactions
Planning and Implementing Cross-Border Transactions in Emerging Countries
Valuing Cross-Border Transactions
Empirical Studies of Financial Returns to International Diversification
Things to Remember
Chapter Discussion Questions
Chapter Business Cases
References
Glossary
Index
- No. of pages: 788
- Language: English
- Edition: 5
- Published: September 22, 2009
- Imprint: Academic Press
- eBook ISBN: 9780080952055
DD
Donald DePamphilis
Donald M. DePamphilis has a Ph.D. in economics from Harvard University and has managed more than 30 acquisitions, divestitures, joint ventures, minority investments, as well as licensing and supply agreements. He is Emeritus Clinical Professor of Finance at the College of Business Administration at Loyola Marymount University in Los Angeles. He has also taught mergers and acquisitions and corporate restructuring at the Graduate School of Management at the University of California, Irvine, and Chapman University to undergraduates, MBA, and Executive MBA students. He has published a number of articles on economic forecasting, business planning, and marketing. As Vice President of Electronic Commerce at Experian, Dr. DePamphilis managed the development of an award winning Web Site. He was also Vice President of Business Development at TRW Information Systems and Services, Director of Planning at TRW, and Chief Economist at National Steel Corporation
Affiliations and expertise
Professor Emeritus of Computer Information Systems & Finance ,Department of Computer Information Systems & Finance ,
Loyola Marymount University ,Los Angeles, CA, USARead Mergers, Acquisitions, and Other Restructuring Activities on ScienceDirect