Sponsors for
          Educational
          Opportunity

Corporate Finance Overview SEO-U Webinar

                      ...
What is Investment Banking /
Corporate Finance?
 Business of offering strategic and financial
 advisory services to corpor...
Three areas of Corporate
Finance

 Investment Banking Coverage

 Mergers & Acquisitions

 Capital Markets
   p




       ...
Investment Banking Coverage
(IBC)
 The coverage groups manage the relationship between
 the firm and its corporate clients...
Capital Markets
C it l M k t
 Equity Capital Markets
   Raises capital for companies by marketing and
   selling equity to...
Mergers & Acquisitions
M         A   i iti
 Why d
 Wh do companies acquire and merge with other companies?
               ...
Recent M&A A ti it
R    t     Activity
  Acquirer   Target   Purchase Price

                        $46.4 billion

      ...
Roles within Investment
Banking
 Managing Director
     Manages the relationship between the client and the bank
     Nego...
Analyst R
A l t Responsibilities
             ibiliti
 Performing financial valuation, discounted cash flow
              ...
Attributes of a Good Analyst /
Summer Analyst
 Attention to detail
 Strong work ethic
      g
 Quick learner
 Ability to c...
Benefits of a position within
Investment Banking
        Exposure
        E
           Unrivaled access to senior manageme...
Day in the Life
     D i th Lif
9:00 a.m. – Rush out of the apartment to the subway station for a 30-minute commute.
9:30 ...
Day in the Life (cont.)
     D i th Lif (        t)
6:00 p.m. – Start working on project #3; this one requires updating an...
Next St
N t Steps
 Read the WSJ to keep up with current market news
 Watch CNBC/FOX Business to gain additional
 perspecti...
Resources
 Additional Information
    vault.com
        Vault Career Guide to Investment Banking
        Vault Guide to th...
Investment Banking in Pop
Culture




                            15
Questions?
Q   ti   ?




             16
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Microsoft PowerPoint - SEO-U Corporate Finance_FINAL ...

  1. 1. Sponsors for Educational Opportunity Corporate Finance Overview SEO-U Webinar Jonathan Shan jshan@seo-usa.org
  2. 2. What is Investment Banking / Corporate Finance? Business of offering strategic and financial advisory services to corporate clients Underwriting - Raising capital for corporate clients M&A - Assist in negotiating and structuring a merger or acquisition 1
  3. 3. Three areas of Corporate Finance Investment Banking Coverage Mergers & Acquisitions Capital Markets p 2
  4. 4. Investment Banking Coverage (IBC) The coverage groups manage the relationship between the firm and its corporate clients IBC fosters this relationship by continually generating new ideas presented in the form of pitchbooks Industry Groups include: Technology, M di & T l T h l Media Telecom (TMT) Consumer/Healthcare Diversified Industrials/Transportation Natural Resources Financial Institutions (FIG) Real Estate, Lodging & Gaming Estate Financial Sponsors 3
  5. 5. Capital Markets C it l M k t Equity Capital Markets Raises capital for companies by marketing and selling equity to retail and institutional investors Initial Public Offering (IPO): the initial sale of stock by a private company to public investors Secondary Offering: the sale of additional stock by a public company to the public Debt Capital Markets Addresses the capital needs of companies by tapping into the debt markets Assesses clients’ assets and cash flows to structure liabilities to match (fixed vs. floating) 4
  6. 6. Mergers & Acquisitions M A i iti Why d Wh do companies acquire and merge with other companies? i i d ih h i ? Source of growth Size Scale S l Products Revenue synergies Cost C t synergies i Types of M&A transactions Strategic acquisitions Mergers Leveraged buyouts Hostile takeovers Takeover defense Joint ventures 5
  7. 7. Recent M&A A ti it R t Activity Acquirer Target Purchase Price $46.4 billion $44.6 billion $ $21.9 billion $12.8 billion $5.9 billion $3.9 billion 6
  8. 8. Roles within Investment Banking Managing Director Manages the relationship between the client and the bank Negotiates terms of the deal and fee structure Vice President Vi P id t Manages the deal/pitch process Reviews all work before it goes to the MD Associate Checks the analyst(s)’ work Analyst Builds the financial model Performs valuation analyses Constructs the pitchbook Summer Analysty Assist the analyst 7
  9. 9. Analyst R A l t Responsibilities ibiliti Performing financial valuation, discounted cash flow valuation (DCF) and multiples-based analyses (comps) Building and using financial models Financial models are tools constructed in Microsoft Excel used to forecast a Company’s operating performance Preparing presentation materials and drafting registered documents for the SEC Pitchbooks are presentations made to clients highlighting idea(s) to address company-specific needs Drafting sessions are meetings between the client, bankers and lawyers where the aim is to generate a “clean” document for the government and potential investors Conducting industry and product research 8
  10. 10. Attributes of a Good Analyst / Summer Analyst Attention to detail Strong work ethic g Quick learner Ability to communicate effectively Understanding of accounting principles Solid quantitative, analytical and technical skills Familiarity ith Microsoft Offi – t h savvy F ili it with Mi ft Office tech 9
  11. 11. Benefits of a position within Investment Banking Exposure E Unrivaled access to senior management of multinational and multibillion-dollar corporations Prestige Advising corporate clients on financings and M&A opportunities Participation on the “headline grabbing” deals Transferable Skills Modeling Valuation – Comps, DCF Financial St t Fi i l Statement A l i t Analysis Multitasking, proven work ethic 10
  12. 12. Day in the Life D i th Lif 9:00 a.m. – Rush out of the apartment to the subway station for a 30-minute commute. 9:30 a.m. – Quickly check e-mail, calendar and status of current projects 10:00 a.m. – Quickly browse the Wall Street Journal, Yahoo! Finance and Bloomberg to get up to speed on market news 10:30 a.m. – Start working on the ever-growing list of things to do. Review financial model for project #1 before sending it to other members of the deal team. Prepare comps for project #2. 1:10 p.m. – Grab lunch; sometimes an hour, most of the time you need to eat at your desk. 1:30 p.m. – The associate on project #1 reviewed the analysis and provides constructive comments, which are “turned” (incorporated) into the model. 2:30 p.m. – Conference call to discuss model for Project #1, which produces more issues/questions that need to be addressed. 3:30 p.m. – Start the pitchbook presentation for project #2 by putting together a “shell” (outline). ( tli ) 4:00 p.m. – Grab coffee with co-workers 4:15 p.m.– Get back to the office and get cranking on the revised model; Complete revisions and send to the deal team before 6:00 p.m. deadline. Send shell of presentation (Project #2 to associate) 5:30 p.m – Send out the revised model (after the associate review it) 11
  13. 13. Day in the Life (cont.) D i th Lif ( t) 6:00 p.m. – Start working on project #3; this one requires updating an old pitchbook for a different client with current market data 7:30 p.m. – Dinner time. Order with a bunch of colleagues from online delivery service 8:30 p.m. – Return to cubicle with a heavily, marked-up copy of the presentation for project #3 11:00 p.m. – After turning all the comments, send the revised version to associate who does a final review and sends it to Production. 11:15 p.m. – Reopen the model for project #1, continue working on analysis 12:30 a.m. 12 30 a m – Finish up the comps for project #2, send them to the associate for review. p #2 re ie 1:00 a.m. – Production calls to inform the analyst the books are done; “Flip the books” which means turn each pitch book to make sure all pages were printed correctly and are in the appropriate order 1:30 a m – The books are flipped and send them by car service to one of the attendees of a.m. the meeting the following day. 2:15 a.m. – Stop working on model and comps when all previous comments are incorporated and issues are resolved; catch a cab to get home; rest for another busy day 12
  14. 14. Next St N t Steps Read the WSJ to keep up with current market news Watch CNBC/FOX Business to gain additional perspective Complete Zoologic to improve your quantitative skills Introduction to Securities Markets Introduction to Corporate Finance Introduction to Analyzing Financial Statements Time Value of Money Introduction to Equity Valuation Attend the Capital Markets Webinar ( p (Mid July) y) Practice Quick Math and Case Questions (Webinar in Late July) Enroll in Finance classes if available Contact SEO alums for industry insight 13
  15. 15. Resources Additional Information vault.com Vault Career Guide to Investment Banking Vault Guide to the Top 50 Banking Employers Vault Guide to Finance Interviews Respective firm websites Research and Estimates Thomson One Analytics First Call Financial News Wall Street Journal Financial Times Bloomberg Reuters 14
  16. 16. Investment Banking in Pop Culture 15
  17. 17. Questions? Q ti ? 16

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