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Unit of study_

FINC6017: Mergers and Acquisitions

Mergers and acquisitions have become perhaps the most important activity of investment banks today. They provide a fundamental way for businesses to secure growth. To analyse mergers and acquisitions, most tools from modern financial economics are needed. The unit commences with a review of how existing businesses are valued, continues with an analysis of capital structure decisions, considers management incentives and examines issues in corporate control. It then examines the motives for mergers and acquisitions. Some acquisitions are motivated by value improvements created by correcting incentive problems, some acquisitions, however, are motivated by bad incentives that decrease value.

Details

Academic unit Finance
Unit code FINC6017
Unit name Mergers and Acquisitions
Session, year
? 
Semester 2, 2021
Attendance mode Normal day
Location Remote
Credit points 6

Enrolment rules

Prohibitions
? 
ACCT6011
Prerequisites
? 
FINC5001
Corequisites
? 
None
Available to study abroad and exchange students

Yes

Teaching staff and contact details

Coordinator Danika Wright, danika.wright@sydney.edu.au
Type Description Weight Due Length
Final exam (Take-home short release) Type D final exam Final exam
Online exam, details will be provided on Canvas.
40% Formal exam period 1.5 hours
Outcomes assessed: LO1 LO5 LO4 LO3 LO2
Assignment Assignment 1
15% Week 06 TBA
Outcomes assessed: LO6 LO7 LO1 LO2 LO3
Assignment group assignment Assignment 2
Group work, details will be provided on Canvas.
30% Week 13 TBA
Outcomes assessed: LO1 LO7 LO6 LO5 LO4 LO3 LO2
Presentation group assignment Group Presentation
15% Week 13 TBA
Outcomes assessed: LO7
group assignment = group assignment ?
Type D final exam = Type D final exam ?
  • Individual assignment: You will analyse individually the strategic context of a recent M&A case study to provide an initial assessment of deal feasibility and advice whether further consideration of the deal should proceed.
  • Group assignment and presentation: The group assignment gives you the opportunity to apply your critical reasoning and analytical problem solving skills to a recent M&A case study, while building effective communication and group-work skills. Groups will ideally consist of 4-5 students (5 students at the maximum) and need to be formed by the end of week 4.
  • Each group will be required to prepare a Powerpoint slide deck and deliver as a group a 'pitch' as a video recording. All group members need to present, and time should be approximately equally allocated to each presenter.

    Full details of the deal and assignment requirements will be provided on Canvas.

  • Final exam: This is an online exam. All content from the semester is examinable. Further details for the final exam including practice questions will be available on Canvas.

Assessment criteria

The University awards common result grades, set out in the Coursework Policy 2014 (Schedule 1).

As a general guide, a high distinction indicates work of an exceptional standard, a distinction a very high standard, a credit a good standard, and a pass an acceptable standard.

Result name

Mark range

Description

High distinction

85 - 100

Awarded when you demonstrate the learning outcomes for the unit at an exceptional standard, as defined by grade descriptors or exemplars outlined by your faculty or school. 

Distinction

75 - 84

Awarded when you demonstrate the learning outcomes for the unit at a very high standard, as defined by grade descriptors or exemplars outlined by your faculty or school.

Credit

65 - 74

Awarded when you demonstrate the learning outcomes for the unit at a good standard, as defined by grade descriptors or exemplars outlined by your faculty or school.

Pass

50 - 64

Awarded when you demonstrate the learning outcomes for the unit at an acceptable standard, as defined by grade descriptors or exemplars outlined by your faculty or school. 

Fail

0 - 49

When you don’t meet the learning outcomes of the unit to a satisfactory standard.

For more information see sydney.edu.au/students/guide-to-grades.

Late submission

In accordance with University policy, these penalties apply when written work is submitted after 11:59pm on the due date:

  • Deduction of 5% of the maximum mark for each calendar day after the due date.
  • After ten calendar days late, a mark of zero will be awarded.

Special consideration

If you experience short-term circumstances beyond your control, such as illness, injury or misadventure or if you have essential commitments which impact your preparation or performance in an assessment, you may be eligible for special consideration or special arrangements.

Academic integrity

The Current Student website provides information on academic honesty, academic dishonesty, and the resources available to all students.

The University expects students and staff to act ethically and honestly and will treat all allegations of academic dishonesty or plagiarism seriously.

We use similarity detection software to detect potential instances of plagiarism or other forms of academic dishonesty. If such matches indicate evidence of plagiarism or other forms of dishonesty, your teacher is required to report your work for further investigation.

WK Topic Learning activity Learning outcomes
Week 01 Introduction and overview of the M&A market Lecture (2 hr) LO1 LO2 LO6
Week 02 Corporate finance and the agency model Lecture and tutorial (3 hr) LO1 LO2 LO6 LO7
Week 03 Assessing M&A outcomes Lecture and tutorial (3 hr) LO1 LO2 LO6 LO7
Week 04 Merger waves Lecture and tutorial (3 hr) LO1 LO2 LO6 LO7
Week 05 Why, when and how do firms engage in M&A Lecture and tutorial (3 hr) LO1 LO2 LO3 LO6 LO7
Week 06 Deal valuation and synergies Lecture and tutorial (3 hr) LO4 LO6
Week 07 Form of payment I Lecture and tutorial (3 hr) LO4 LO5 LO6 LO7
Week 08 Form of payment II Lecture and tutorial (3 hr) LO4 LO5 LO6 LO7
Week 09 Corporate restructuring Lecture and tutorial (3 hr) LO2 LO6 LO7
Week 10 LBOs and go-private transactions Lecture and tutorial (3 hr) LO2 LO3 LO4 LO6 LO7
Week 11 Hostile takeovers and defense tactics Lecture and tutorial (3 hr) LO3 LO4 LO6 LO7
Week 12 Merger arbitrage Lecture and tutorial (3 hr) LO2 LO5 LO6 LO7
Week 13 Shareholder activism Lecture and tutorial (3 hr) LO1 LO2 LO6 LO7

Study commitment

Typically, there is a minimum expectation of 1.5-2 hours of student effort per week per credit point for units of study offered over a full semester. For a 6 credit point unit, this equates to roughly 120-150 hours of student effort in total.

Required readings

See Canvas for weekly required reading list.

Prescribed textbook: Mergers and Acquisitions 5th Ed., Custom print, Pearson Australia (Sydney).

Chapters from the textbook will be supplemented by journal articles and other online materials.

Learning outcomes are what students know, understand and are able to do on completion of a unit of study. They are aligned with the University’s graduate qualities and are assessed as part of the curriculum.

At the completion of this unit, you should be able to:

  • LO1. Analyse and discuss the strategic role of mergers and acquisitions to corporations in value creation
  • LO2. Evaluate how and why corporate restructuring activities are an important part of the efficient operations of financial markets
  • LO3. Examine particular forms of mergers and acquisitions to determine critical aspects of a deal, as well as provide a recommendation to a particular group of stakeholders
  • LO4. Measure and analyse the significance of control premium and synergies, identify and justify likely control premium and synergies in a given corporate M&A deal, and determine optimal deal structures. Assess the risks of M&A implementation
  • LO5. Understand various classes of risk management tools used in M&A and their advantages and weaknesses
  • LO6. Conduct research using archives, libraries, web-sourced data and other sources of information to produce timely and high-quality work
  • LO7. Communicate clearly and succinctly issues relating to M&A

Graduate qualities

The graduate qualities are the qualities and skills that all University of Sydney graduates must demonstrate on successful completion of an award course. As a future Sydney graduate, the set of qualities have been designed to equip you for the contemporary world.

GQ1 Depth of disciplinary expertise

Deep disciplinary expertise is the ability to integrate and rigorously apply knowledge, understanding and skills of a recognised discipline defined by scholarly activity, as well as familiarity with evolving practice of the discipline.

GQ2 Critical thinking and problem solving

Critical thinking and problem solving are the questioning of ideas, evidence and assumptions in order to propose and evaluate hypotheses or alternative arguments before formulating a conclusion or a solution to an identified problem.

GQ3 Oral and written communication

Effective communication, in both oral and written form, is the clear exchange of meaning in a manner that is appropriate to audience and context.

GQ4 Information and digital literacy

Information and digital literacy is the ability to locate, interpret, evaluate, manage, adapt, integrate, create and convey information using appropriate resources, tools and strategies.

GQ5 Inventiveness

Generating novel ideas and solutions.

GQ6 Cultural competence

Cultural Competence is the ability to actively, ethically, respectfully, and successfully engage across and between cultures. In the Australian context, this includes and celebrates Aboriginal and Torres Strait Islander cultures, knowledge systems, and a mature understanding of contemporary issues.

GQ7 Interdisciplinary effectiveness

Interdisciplinary effectiveness is the integration and synthesis of multiple viewpoints and practices, working effectively across disciplinary boundaries.

GQ8 Integrated professional, ethical, and personal identity

An integrated professional, ethical and personal identity is understanding the interaction between one’s personal and professional selves in an ethical context.

GQ9 Influence

Engaging others in a process, idea or vision.

Outcome map

Learning outcomes Graduate qualities
GQ1 GQ2 GQ3 GQ4 GQ5 GQ6 GQ7 GQ8 GQ9
The following changes have been made: 1. midsemester replaced with in-semester assignments 2. teaching schedule modified to better accommodate 13-week program

Disclaimer

The University reserves the right to amend units of study or no longer offer certain units, including where there are low enrolment numbers.

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