Student guide Faculty of Economics A.Y. 2007/08

The subject area of business valuations has come to the fore in recent years, in the wake of economic changes resulting in more frequent special finance operations which call for the financial valuation of share packets, companies, company branches, etc. These changes can be attributed to the generational changeover in the leadership of companies, growing internationalisation of financial and commercial markets, and other factors that have increased the number of mergers, acquisitions, incorporations, etc.. Because the trend is expected to continue in the coming years, professionals and business consultants will need to be equipped with the knowledge and tools for handling a complex operation that is not always fully understood: the valuation of a company's capital assets.
Given the above premises, the course provides a theoretical and practical grounding in the methods and principal problems arising from the application of business valuation processes, with explicit reference to the various ends for which they are carried out. The methods most frequently employed are therefore studied comprehensively, also with reference to the situations forming the backdrop to business valuations, and the underlying mechanisms of capital asset pricing.
The course will cover valuation criteria based upon flows of anticipated results (flows of revenues, or financial flows), on multiples and other market methods. Particular attention will then be devoted to the standard criteria employed for the valuation of so-called intangibles. To further clarify the material, the lectures will also include practical case studies to which students can directly apply the valuation criteria taught during the course.

1. Framing of value estimation problems
2. Flow based methods: the income-based method
3. Flow based methods: the financial method
4. Growth and risk profiles
5. Financial structure and value
6. Acquisitions and estimation of potential value
7. Market multiples and comparable transactions
8. Asset-based methods and combined methods
9. Valuation of intangibles
10. Valuation of banks and financial companies

There will be an oral examination at the end of the course.

Required course textbook:
Borsa italiana, Guida alla valutazione, available on the website:
http://www.borsaitalia.it/it/mercati/homepage/comequotarsi/listingguides/

Reference textbooks:
Guatri L. Bini M, Nuovo trattato sulla valutazione delle aziende, Università Bocconi Editore, Milano, 2005;
Guatri L, Trattato sulla valutazione delle aziende, EGEA, Milano, 1998;
Massari M, Zanetti L, Valutazione finanziaria, McGraw - Hill, Milano, 2004;
Donna G, La creazione di valore nella gestione dell'impresa, Carocci, Roma, 1999.