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Finance of Mergers and Acquisitions: Valuation and Pricing

Finance of Mergers and Acquisitions: Valuation and Pricing

This course is part of Mergers and Acquisitions Specialization

Instructor: Heitor Almeida

41,831 already enrolled

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5 modules

Gain insight into a topic and learn the fundamentals.

310 reviews

Intermediate level

Recommended experience

Flexible schedule

2 weeks at 10 hours a week

Learn at your own pace

93%

Most learners liked this course

5 modules

Gain insight into a topic and learn the fundamentals.

310 reviews

Intermediate level

Recommended experience

Flexible schedule

2 weeks at 10 hours a week

Learn at your own pace

93%

Most learners liked this course

What you'll learn

Use valuation tools to find and design value-enhancing M&A deals.
Forecast cash flows and estimate discount rates using real world data.
Determine the net present value (NPV) of an M&A deal for both the acquirer and the target.
Value M&A synergies using both the management and the market’s perspectives

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Assessments

16 assignments

Taught in English

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This course is part of the Mergers and Acquisitions Specialization

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There are 5 modules in this course

This course teaches how to value and price M&A deals and to choose the optimal financing mix for an M&A deal. The course focuses on all the major types of M&A deals including strategic M&A, private equity leveraged buyouts (LBOs), and restructuring deals such as spinoffs and asset transfers.

You will learn the basic terminology of M&A, which we will use throughout the course. You will also learn why M&A deals happen, and how to identify drivers of M&A that are truly value-enhancing. Finally, you will study the history of M&A and learn key facts about previous M&A waves.

What's included

11 videos6 readings5 assignments1 plugin

11 videosTotal 103 minutes

Course Introduction7 minutes
Meet Professor Almeida6 minutes
Learn on Your Terms1 minute
Module 1 Objectives and Overview4 minutes
Good Reasons to Engage in M&A Transactions13 minutes
Bad Reasons to Engage in M&A Transactions10 minutes
Private Equity LBOs and Other Restructuring Tools 17 minutes
Friendly vs. Hostile Deals, and M&A Regulation18 minutes
A Brief History of M&A12 minutes
Does M&A Create Value?13 minutes
Module 1 Review3 minutes

6 readingsTotal 60 minutes

Syllabus10 minutes
About the Discussion Forums10 minutes
Online Education at Gies College of Business10 minutes
Getting to Know Your Classmates10 minutes
Updating Your Profile10 minutes
Module 1 Overview10 minutes

5 assignmentsTotal 75 minutes

Overview of M&A Topics and Evidence Quiz30 minutes
Orientation Quiz30 minutes
Lesson 1.2 Practice Quiz5 minutes
Lesson 1.3 Practice Quiz5 minutes
Lesson 1.4 Practice Quiz5 minutes

1 pluginTotal 15 minutes

Welcome! Please Tell Us About Yourself15 minutes

What determines a company’s stock price? Placing a value on companies is a key tool for M&A analysis. This module focuses on the main methods available to estimate stock prices, including discounted cash flow valuation and multiples-based valuation. You will learn these tools using the most up-to-date Finance theory and real-world examples.

What's included

12 videos1 reading5 assignments

12 videosTotal 147 minutes

Module 2 Objectives and Overview5 minutes
Forecasting Profits and Investments15 minutes
Free Cash Flows18 minutes
Using Returns to Measure Risk13 minutes
The Capital Asset Pricing Model (CAPM)12 minutes
The Weighted Average Cost of Capital (WACC)7 minutes
Improving Your Estimate of the Expected Return on Debt15 minutes
Improving Your Estimate of the Expected Return on Equity19 minutes
Computing Enterprise Value and Stock Prices8 minutes
Using Comparables for Valuation20 minutes
Sensitivity Analysis13 minutes
Module 2 Review2 minutes

1 readingTotal 10 minutes

Module 2 Overview10 minutes

5 assignmentsTotal 70 minutes

Company Valuation Quiz30 minutes
Lesson 2.2 Practice Quiz10 minutes
Lesson 2.3 Practice Quiz10 minutes
Lesson 2.4 Practice Quiz10 minutes
Lesson 2.5 Practice Quiz10 minutes

Valuation analysis is a major part of the work that investment banks do when advising companies involved in M&A deals. You will learn that both target and acquirer valuation matter, and why. This module also focuses on what is special about the valuation and pricing of non-publicly traded targets. Finally, you will learn how to best use transaction multiples in the valuation of M&A deals.

What's included

7 videos1 reading3 assignments

7 videosTotal 69 minutes

Module 3 Objectives and Overview3 minutes
The Role of Target Valuation9 minutes
Private Targets: Valuation Issues20 minutes
Private Targets: Pricing Issues7 minutes
Transaction Multiples16 minutes
The Role of Acquirer Valuation10 minutes
Module 3 Review4 minutes

1 readingTotal 10 minutes

Module 3 Overview10 minutes

3 assignmentsTotal 50 minutes

The Role of Target and Acquirer Valuation in M&A Quiz30 minutes
Lesson 3.2 Practice Quiz10 minutes
Lesson 3.3 Practice Quiz10 minutes

This module starts with how to place a value on synergies using cash flow forecasts provided by management, and also using the stock market reaction to a new M&A deal. Next, you will also learn how to relate synergies to the premium paid for targets and how to calculate the net present value (NPV) of a deal. You will also learn the specifics of hostile takeover deals with a focus on governance, legal, and valuation issues.

What's included

11 videos2 readings3 assignments1 peer review

11 videosTotal 162 minutes

Module 4 Objectives and Overview7 minutes
Synergy Valuation: Management Perspective14 minutes
Synergy Valuation: The Market's View18 minutes
The Chance of Deal Failure and Merger Arbitrage13 minutes
Additional Examples: When Markets and Managers Disagree16 minutes
Bidder Strategies15 minutes
Target Strategies22 minutes
Do Takeover Defenses Create or Destroy Value?11 minutes
Examples of Hostile Deals22 minutes
Module 4 Review3 minutes
Honors Assignment Details and Sample Solution21 minutes

2 readingsTotal 20 minutes

Module 4 Overview10 minutes
Honors Assignment Information10 minutes

3 assignmentsTotal 50 minutes

Synergies and Hostile Takeovers Quiz30 minutes
Lesson 4.2 Practice Quiz10 minutes
Lesson 4.3 Practice Quiz10 minutes

1 peer reviewTotal 180 minutes

Honors Assignment180 minutes

What's included

1 video2 readings1 plugin

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Build toward a degree

This course is part of the following degree program(s) offered by University of Illinois Urbana-Champaign. If you are admitted and enroll, your completed coursework may count toward your degree learning and your progress can transfer with you.¹

Instructor

Instructor ratings

(89 ratings)

Heitor Almeida

University of Illinois Urbana-Champaign

5 Courses118,829 learners

Offered by

University of Illinois Urbana-Champaign

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Reviewed on Jul 18, 2023

Quite good course, demands lots of dedication but totally worth it. (it contains lots of calculations) You will do well as long as you are organized and take notes during the lessons.

Reviewed on Apr 7, 2025

Excellent coverage of valuation and finance fundamentals for M&A. Thanks!

Reviewed on Nov 14, 2022

course is well laid out -- the professor did a great job at explaining the material and was able to take the student through it in a way that made it very understandable. highly recommend

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