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Executive Education
Clariden Leadership Institute
M&A Financial Modeling & Deal Structuring (SG)
Thomas Kessler
IntegrationSuccess GmbH

This program has been independently accredited and certified by CPD
Thomas Kessler, IntegrationSuccess GmbH
  • Thomas has led some of the most successful M&A deals around the world – including Deutsche Post acquisition of Global Mail, Goodyear Sumitomo Rubber merger, Avaya Global Connect joint venture with Tata and Albany International and Geshmay group merger
  • His successful deal transactions has been selected by Harvard as part of Harvard Business School case studies on mergers and acquisitions
  • Adjunct Professor – Thomas has taught in major institutions like the Zürich University, KPMG, PWC European Center of Excellence and more


With over 19 years of M&A experience, Thomas Kessler has led major landmark M&A transactions including Deutsche Post acquisition of Global Mail, Deutsche Telekom Orange Netherlands combination, Goodyear Sumitomo Rubber merger, Avaya Global Connect JV with Tata, Wacker and Air Products JV and the Albany International and Geshmay group merger. The latter has been featured as a Harvard Business School Case Study. He is now the Founder and Managing Partner of IntegrationSuccess GmbH. His primary focus is on creating financial value for companies through M&A, JV and corporate restructuring. He has been involved in over 25 major transactions with a total valuation of more than US$20 billion. Thomas is an accomplished faculty leader in universities and institutions globally such as the KPMG, Zürich University PWC European Center of Excellence and Ericsson Training Center.

This course has been independently certified as conforming to universally accepted CPD guidelines. On average, this executive program contributes 24 hours towards your CPD.

Program Summary

 

This program will show you the entire M&A process step by step, introduce you to industry specific terms and acronyms, details the legal documents used when buying or selling a company, discusses valuation techniques, reveals insights about how to finance deals, provides real world examples of how to structure transactions and bridge valuation gaps between Buyer and Seller, and gives you the tools you will need to successfully close M&A transactions.

 

In addition, you’ll get expert advice on identifying and contacting potential M&A targets, performing due diligence, drafting the purchase agreement, and integrating new employees after the deal closes.


Led by a faculty director who has closed over US$20bn of M&A transactions worldwide and who’s case study has been used by Harvard Business School, Thomas Kessler will offer providing crucial guidance on preparing for your M&A deal; regulatory considerations; due diligence; deal structure; valuation and pricing; and financing even during turbulent market conditions



Programs, dates and locations are subject to change. In accordance with Clariden Global policy, we do not discriminate against any person on the basis of race, color, sex, religion, age, national or disability in admission to our programs.

Introduction

 

In an increasingly globalized world, M&As are essential mechanisms of shareholder value enhancement. M&A is facilitating access to new markets, capacities and technologies, as well as enabling organizations to focus on core competencies. Well-planned and strategic M&As are transforming a number of corporations into global or regional powerhouses and enabling unprecedented growth beyond geographical market limitations. As financial modeling in M&A is often the centrepiece of the entire M&A process, it is crucial that you and your organization have the right capabilities to develop a full merger model that takes into account all aspects of your M&A strategy.

 

This program will show you the entire M&A process step by step, introduce you to industry specific terms and acronyms, details the legal documents used when buying or selling a company, discusses valuation techniques, reveals insights about how to finance deals, provides real world examples of how to structure transactions and bridge valuation gaps between Buyer and Seller, and gives you the tools you will need to successfully close M&A transactions.

 

In addition, you’ll get expert advice on identifying and contacting potential M&A targets, performing due diligence, drafting the purchase agreement, and integrating new employees after the deal closes.

 

Led by a faculty director who has closed over US$20bn of M&A transactions worldwide and who’s case study has been used by Harvard Business School, Thomas Kessler will offer providing crucial guidance on preparing for your M&A deal; regulatory considerations; due diligence; deal structure; valuation and pricing; and financing even during turbulent market conditions

What You Can Expect

 

  • Identifying Strategic Acquisition Targets: Deciding what to buy and then locating it 
  • Valuation and Pricing - Using multiple valuation methods to discover the true value of an acquired company or unit 
  • The Art of Financing and Refinancing - Mastering funding sources and issues 
  • Structuring M&A, Joint Venture and Divestiture Transactions - Managing general, tax, and accounting considerations 
  • Financial Impact of Acquisition - Model the financial impact of your transaction, including earnings accretion/ dilution, contribution analysis, pro-forma financial statements and other financial consequences 
  • Post-Merger Integration and Divestitures Following through after the M&A deal to capture the economic value of synergies

Who Will Benefit Most

 

This highly interactive program is designed for all C-level and senior level executives (SVP, VP, MD, Director, Head) who are involved in M&A or who are in these roles or related ones: CFO, Finance, Financial Controller, Banking, Treasury, Accounting, Strategic Planning / Management, Corporate Planning / Strategy, Group Strategy, Business Planning / Analysis / Development, Private Equity / Venture Capital, Investor / Investing, Valuation

Program Outline

 

Day 1 - Morning

RATIONALE FOR MERGERS & ACQUISITIONS

  • MERGERS & ACQUISITION VS. STRATEGIC ALLIANCES
    When should you acquire versus forming a strategic alliance? What are the empirical characteristics of successful strategic alliances versus a successful merger or acquisition respectively?
    ‘Group Exercise I’ discussion of the key characteristics of M&A transactions vs. Joint Ventures

  • CURRENT TRENDS IN M&A
    What is driving deals in the region? – Inbound/Outbound – Industry Trends

  • INTRODUCTION OF THE M&A LIFE-CYCLE
    Gaining an overview of the three phases including a high level discussion of each step of the pre deal, deal, and post deal phase. Identification and definition of the key integration factors that will assure your success
    ‘Group Exercise II’ discussion of the M&A Life cycle

DEAL STRUCTURE

  • THE DEAL STRUCTURING PROCESS
    Linking acquisition objective and organizational structure. What form of payments should you be knowledgeable about when negotiating transactions?

  • DEAL STRUCTURES: ACQUISITIONS, MERGERS, JOINT VENTURES, SPIN-OFFS, SPLIT-OFFS, CARVE-OUTS AND DIVESTITURES, TARGET STOCK
    Typical deal structures, implications of asset deals and stock deals in mergers & acquisitions, structural intent, choice of transaction structure, benefit-risk profile of the respective corporate event?
    ‘Group Exercise III’ – participants will review publicly known transactions for each respective type and discuss the characteristics

MERGERS & ACQUISITIONS MODELING – P&L, Initial Valuation, Synergies

  • INTRODUCTION
    How to model your M&A transaction? Delegates will be working through all key steps to accomplish a merger model. The group work guides delegates through modeling topics as well as a M&A transaction

  • COMPLETING CORE FINANCIAL AND OPERATIONAL ANALYSIS ON A TARGET BUSINESS
    What are the most critical financial metrics that need to be fully understood?
    ‘Group Exercise IV’ Modeling and Review of the P&L
    • STEP 1: REVIEW TARGET’S HISTORICAL AND PROJECTED P&L, ADJUST IF NECESSARY

Day 1 - Afternoon

BUSINESS VALUATION

  • IDENTIFY THE KEY COMPONENTS OF THE PURCHASE PRICE FORMULA
    ‘Group Exercise V’ – Business valuation the simple way

  • THE DIFFERENT APPROACHES USED FOR VALUATION AND THEIR DIFFERENCES
    Group discussion of the valuation methodologies
    Group Exercise VI’ – Delegates will discuss a) the advantages and disadvantages of the discount cash flow (DCF) valuation method, b) the difference between enterprise value and equity value, c) the strengths and weaknesses of the income approach, d) when to use a market vs cost approach in valuation

  • MODELING THE INITIAL VALUE OF THE TARGET VALUATION
    Delegates will discuss the treasury method towards calculating the fully dilutive number of shares / the ITM (in-the-money) convertible shares to. In addition we will define the high level deal assumptions and apply the valuation methodologies using our case
    • STEP 2: VALUE TARGET COMPANY (DCF VS. MULTIPLES)
      • STEP 2.1: TREASURY METHOD TOWARDS CALCULATING THE FULLY DILUTIVE NUMBER OF SHARES
      • STEP 2.2: CALCULATE IN-THE-MONEY CONVERTIBLE SHARES
      • STEP 2.3: DEFINE ENTERPRISE VALUE
      • STEP 2.4: DEFINING THE DEAL ASSUMPTIONS
      • STEP 2.5: VALUING THE TARGET USING DCF AND MULTIPLES

SYNERGIES

  • ANALYZING TRANSACTION SYNERGIES AND RISKS
    Discussion of possible transaction challenges, risks, hurdles versus synergies and dis-synergies. How to identify and quantify synergies using interviews? Introducing two largely successful synergy templates used by MNCs

  • APPLY THE SYNERGY CONCEPT IN OUR CASE
    Delegates will identify synergies (revenue, operating, capex), model them and apply them in our model to demonstrate the impact on the target/combined case
    ‘Group Exercise VII’ Modeling of the synergies and their impact
    • STEP 3: IDENTIFY SYNERGISTIC VALUE BUILD INTO THE DEAL (REVENUE, COST, CAPEX)
    • STEP 4: USE BUYER P&L, TARGET P&L AND SYNERGY CASE TO BUILD
    • STEP 5: PRO-FORMA INCOME STATEMENT FOR THE COMBINED GROUP

Day 2 - Morning

MERGERS & ACQUISITIONS MODELING – CASH FLOW AND B/S STEPS

  • COMPLETING CORE WORKING CAPITAL ANALYSIS ON A TARGET BUSINESS
    What are the most important steps in the working capital analysis?
    ‘Group Exercise VIII’ – Working Capital Analysis and transfer into our case model
    • STEP 6: BUILD THE WORKING CAPITAL SCHEDULE (BASIS SALES/COGS)

  • COMPLETING CORE FINANCIAL AND OPERATIONAL ANALYSIS ON THE BALANCE SHEET OF A TARGET BUSINESS
    Discussion of the quality of asset and liability positions and most important net assets, net debt and debt like assets?
    ‘Group Exercise IX’ – Net Debt Analysis and application in our case model
    • STEP 7: REVIEW TARGET’S HISTORICAL (LTM) B/S AND BUILD PROJECTED B/S, ADJUST FOR CAPEX SYNERGIES, AND RESTRUCTURING INITIATIVES
    • STEP 8: DEVELOP A DEPRECIATION SCHEDULE FOR FIXED ASSETS (ADDITIONAL INFORMATION NEED TO BE ENTERED FOLLOWING THE PURCHASE PRICE ALLOCATION)
    • STEP 9: DEVELOP AN INTANGIBLE ASSET AMORTIZATION SCHEDULE

MERGERS & ACQUISITIONS MODELING – CASH FLOW AND B/S STEPS

  • COMPLETING CORE CASH FLOW ANALYSIS ON A TARGET BUSINESS
    What are the most important steps in the cash flow analysis? Analysis of the cash conversion rate, e.g. bridging EBIDA and Free Cash Flow?
    ‘Group Exercise X’ – Application in our case model
    • STEP 10: BUILD THE INITIAL CASH FLOW STATEMENT (AS MUCH AS POSSIBLE AT THIS STAGE)

MERGERS & ACQUISITIONS MODELING – PRICING, FINANCING

  • ‘Group Exercise XI’ – Development of a pricing understanding in our case model
    • STEP 11: DEFINE A ROUGH PRICE ASSUMPTION BASED ON THE INITIAL VALUATION
    • STEP 12: DEFINE THE POTENTIAL RANGE OF A CONTROL PREMIUM INCLUDING IMPACT OF ITM STOCK OPTIONS, ITM CONVERTIBLES

Day 2 - Afternoon

MERGERS & ACQUISITIONS MODELING – PRICING, FINANCING

  • DELEGATES WILL REVIEW THE MOST IMPORTANT CONCEPTS THAT INFLUENCE PRICING AND FINANCING OF A TRANSACTION
    ‘Group Exercise XII’ – Application in our case model
  • FUNDAMENTALS OF CAPITAL STRUCTURE
    Review of cost versus flexibility characteristics of financial instruments. Discussion of pro’s and con’s
  • FINANCING VEHICLES / ALTERNATIVES
    Review of available instruments covering a broad range from debt to equity structures including hybrid instruments
  • LINKING DEAL STRUCTURES TO FINANCING STRUCTURES
    Review of typical deal structures and associated financial structures. Discussion of financing solutions such as equity issuance, leveraged acquisitions and leveraged buyouts, bridge financing deferred considerations: earn-outs, CVRs
    • STEP 13: FINANCING OF THE TRANSACTION - PREPARE INITIAL FINANCIAL STRUCTURE

MERGERS & ACQUISITIONS MODELING – PRICING, FINANCING

  • ‘Group Exercise XIII’ – Developing the financing structure and application in our case model
    • STEP 14: DEVELOP INITIAL FEES, PROCEEDS, INTEREST RATES AND AMORTIZATION SCHEDULES AND DEFINE A MINIMUM CASH BALANCE
      • ESTABLISH FINANCIAL INSTRUMENT OVERVIEW (COST AND TIMING)
      • DEFINE MINIMUM CASH BALANCE (RULE OF THUMB 2-10% OF SALES)
    • STEP 15: DEVELOP AN INTEREST RATE OVERVIEW BY YEAR
    • STEP 16: BUILD A DEBT SCHEDULE
    • STEP 17: BUILD AN AMORTIZATION SCHEDULE FOR CAPITALIZED FINANCING COST

Day 3 - Morning

MERGERS & ACQUISITIONS MODELING – PPA

  • TAX CONSIDERATIONS
    What are the four key M&A tax considerations used in deal structures. Delegates will review the Link between deal structures
    ‘Group Exercise XIV’ Delegates will model the Purchase Price Allocation (PPA) and its impact if the M&A transaction is an asset deal or stock deal transaction
    • STEP 18: CONDUCT A PURCHASE PRICE ALLOCATION
    • STEP 19: ASSESS BOOK AND TAX STEP UP OF ASSETS PURCHASED - IN CASE OF AN ASSET DEAL

MERGERS & ACQUISITIONS MODELING – PPA
‘Group Exercise XV’
 Delegates will continue to model the impact of the Purchase Price Allocation (PPA)

  • STEP 20 ASSESS BOOK STEP UP OF ASSETS PURCHASED IN CASE OF AN EQUITY DEAL
  • STEP 21: ASSOCIATE PURCHASE PRICE ALLOCATION EFFECTS TO CONSOLIDATED B/S
  • STEP 22: BUILD THE BALANCE SHEET POST PPA
  • STEP 23: DEVELOP AND EXPAND TAX SCHEDULE

Day 3 - Afternoon

MERGERS & ACQUISITIONS MODELING – TRANSACTION FINANCIALS

  • TRANSACTION FINANCIALS
    ‘Group Exercise XVI’ Delegates will complete the financial modeling for the P&L and Balance sheet post deal including a cash analysis needed to support the financing structure used
    • STEP 24: PROJECTED P&L POST DEAL
    • STEP 25: BUILD THE TRANSACTION BALANCE SHEET
    • STEP 26: IDENTIFY HOW MUCH CASH IS GENERATED TO REFINANCE TRANSACTION FINAINCING

MERGERS & ACQUISITIONS MODELING – TRANSACTION FINANCIALS

  • ‘Group Exercise XVII’ – Developing the review and model the returns from the transaction, compare against the hurdle rate for transactions and reflect on the price ranges for the transaction
    • STEP 27: REVIEW IF THE RETURNS BASED ON EQUITY VALUE IMPROVEMENT MEET FIRMS HURDLE RATE AND MAXIMUM PRICING/VALUATION FOR THE TRANSACTION

  • ‘Group Exercise XVIII’ – In closing the transaction modeling delegates will review the impact of the transaction on EPS
    • STEP 28: PRESENTATION OF TRANSACTION IMPACT ON EPS ACCRETION / DILUTIO

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Venue: Mandarin Oriental, Singapore
Date: 17 - 19 July 2017
Faculty: Thomas Kessler
Early Bird 1: S$3,650 (by 15 May 2017)
Early Bird 2: S$3,850 (by 12 June 2017)
Regular Fee: S$3,950
Group Discount: 2nd participant get 10%, or register 3 participants and 4th participant get a complimentary seat
(1 discount scheme applies)
Note: GST is applicable to participants from Singapore registered companies.
Contact: gwen@claridenglobal.org
 
 
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