Corporate Finance

Lectures and Seminars

M. Lambert

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 1
 Corporate Finance

Introduction
Course objectives
Course outline and agenda
Practical information and evaluation

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 2
 Corporate Finance

• Corporate finance theory deals with all the

decisions that a business can make and that could
have an impact on the firm value

• Every decision that a business makes has financial

implications, and any decision which affects the
finance of the firm is a corporate finance decision

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 3
 Value creation:
the Balance Sheet model of the firm
Working
capital Current liabilities
Current assets

Long-term
liabilities
Fixed assets :

1. Tangible fixed
assets Shareholders’
2. Intangible equity
fixed assets

Ross, Westerfield and Jaffe, 8th edition

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 4
 Corporate Finance in 4 questions

• In what long-lived assets should the firm invest?

Capital budgeting/Investing decisions
• How can the firm raise cash for its required capital
expenditures? Financing decisions and capital
structure
• How should short-term operating cash flows be
managed? Timing of cash flows and short-term
financing decisions
• How should the distribution of cash to shareholders
be managed? Dividend policy and stock repurchases

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 5
 Corporate Finance in 4 questions
• In what long-lived assets should the firm invest? Capital
budgeting/Investing decisions

• How can the firm raise cash for its required capital
expenditures? Financing decisions and capital structure

• How should short-term operating cash flows be managed?

Timing of cash flows and short-term financing decisions

• How should the distribution of cash to shareholders be

managed? Dividend policy and stock repurchases

Objective: value creation

à Maximizing firm value versus shareholder wealth

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 6
 Objective function of a business firm

• Business firms
Firms which are publicly traded vs. private firms

• Stock price maximization, stockholder wealth

maximization, and firm value maximization

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 7
 Corporate Finance

Introduction
Course objectives
Course outline and agenda
Practical information and evaluation

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 8
 Corporate Finance in 4 questions
• In what long-lived assets should the firm invest? Capital
budgeting/Investing decisions

• How can the firm raise cash for its required capital
expenditures? Financing decisions and capital structure

• How should short-term operating cash flows be

managed? Timing of cash flows and short-term financing
decisions

• How should the distribution of cash to shareholders be

managed? Dividend policy and stock repurchases

Objective: value creation

à Maximizing firm value versus shareholder wealth

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 9
 Corporate Finance in 4 questions
• In what long-lived assets should the firm invest? Capital
budgeting/Investing decisions

• How can the firm raise cash for its required capital
expenditures? Financing decisions and capital structure

• How should short-term operating cash flows be

managed? Timing of cash flows and short-term financing
decisions

• How should the distribution of cash to shareholders be

managed? Dividend policy and stock repurchases

Objective: value creation

à Maximizing firm value versus shareholder wealth

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 10
 Corporate Finance

Introduction
Course objectives
Course outline and agenda
Practical information and evaluation

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 11
 Schedule
• Lecture 1: September 21st (9.00 AM – 12.00 PM)
Introduction // Block 1: Fundamentals // Block 2: Financial analysis

• Lecture 2: September 28th (9.00 AM – 12.00 PM)

Block 2: Financial analysis (end) // Block 3: Free Cash Flows to the
Firm

• Lecture 3: October 5th (9.00 AM – 12.00 PM)

Block 4: Cost of capital – part A

Please complete Blocks 1 to 3 quizzes by October 5th at the latest to be

accounted for in your continuous evaluation!
Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 12
 Schedule
• Lecture 4: October 12th (9.00 AM – 12.00 PM)
Block 4: Cost of capital – part B

• Lecture 5: October 19th (9.00 AM – 12.00 PM)

Blocks 1 to 4: Exercise session 1

• Lecture 6: October 26th (9.00 AM – 12.00 PM)

Block 5: Discounted Cash flow (finite and infinite life) // Block 6: Firm
valuation

Please complete Blocks 4 to 6 quizzes by November 9th at the latest to be

accounted for in your continuous evaluation!
Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 13
 Schedule

• Lecture 7: November 16th (9.00 AM – 12.00 PM)

Block 7: Capital Budgeting: NPV

• Lecture 8: November 23rd (9.00 AM – 12.00 PM)

Block 8: Alternative investment rules
Block 9: Corporate Finance at work

• Lecture 9: December 7th (9.00 AM – 12.00 PM)

Blocks 5 to 8: Exercise session 2

• Lecture 10: December 14th (9.00 AM – 12.00 PM)

Wrap up and exam preparation
Please complete Blocks 7 and 8 quizzes by November 30th at the latest to be
accounted for in your continuous evaluation!
Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 14
 Seminars
(Distance learning)

• Distance learning: see instructions on lol@

– Seminar 1: Financial Analysis
– Seminar 2: Forecast and Due Diligence
– Seminar 3: Cost of Capital
– Seminar 4: Valuation
– Seminar 5: Capital Budgeting
--------------------------------------------------------------------------------------
Deadline for completing the digital seminars
• Seminars 1 – 2: 5th October 2023
• Seminars 3-4: 9th November 2023
• Seminar 5: 30th November 2023
Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 15
 Remediation
• 4 sessions on Fridays
Q&A sessions
– 6th October from 1.30 PM onwards
– 10th November from 1.30 PM onwards
– 1st December from 1.30 PM onwards
– 15th December from 1.30 PM onwards

• Wrap up
– Quizz to be completed by December 11th, 9.00 AM
– Solutions online on December 11th PM to be prepared for the Q&A
Session on Thursday December 14th (9.00 AM – 12.00 PM)

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 16
 Corporate Finance

Introduction
Course objectives
Course outline and agenda
Practical information and evaluation

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 17
 Corporate Finance

Introduction
Course objectives
Course outline and agenda
Practical information and evaluation

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 18
 General information

• Textbooks:
- Hillier, Grinblatt &
Titman, Financial
Markets and
Corporate Strategy,
McGraw-Hill,
European Edition
- Equity Valuation,
Wiley

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 19
 General information

• Professor:

• Teaching assistant:
[email protected]

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 20
 Readings (Grinblatt and Titman)

• Mandatory readings:
- Chapters 9, 10, 11 and 13

• Prerequisites: Financial Market Theory

- Recommended readings: Chapters 2, 3, 23, 4 & 5

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 21
 Evaluation

• Final written exam (75%)

• Continuous evaluation (25%)
– End of block quizzes (same deadline as for the seminars)
– Seminar tutorial and excel. Quizzes on seminars
Grading criteria: to be accounted for the continuous
evaluation, it needs to be done individually, seriously (no
random selection of answers, quiz to be completed in one
« go », in a reasonable time, not copying the answers from
your colleagues) and …on time! Check out the deadlines !

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 22
 Pedagogic commitments

• Please read the pedagogic commitments

following this link

https://www.programmes.uliege.be/cocoon/2
0232024/en/cours/FINA0050-1.html

Information about the course content, evaluation,

textbook….

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 23
 Student toolbox

• A forum has been created on lol@. Please ask there the

questions (in the appropriate category) you could have
regarding the course and check whether the questions has
not already been asked.
• Connect to the interactive platform “Wooclap” (by sms or
internet link) for answering concept checkers during the
course!
• Quizzes online (on lol@) to exercise for the exam!
• Remedial session

Corporate Finance: Lectures and Seminars, HEC Liège 2023-2024 – Marie Lambert 24