Corporate Valuation and Takeover

• This book critically evaluates corporate equity valuation in today’s volatile markets using asset values, earnings, dividend policy, cash flow analysis and behavioural theory. The case for efficient markets and performance measures (based on yields and P/E ratios) published by stock exchanges worldwide to provide market participants with a framework for investment analysis is assessed. Finally, the two most important strategic decisions corporate management and investors will ever encounter are analysed; an unlisted company seeking a stock exchange quotation and a listed company preparing a takeover bid.

Content :- 

Part I: An Introduction

1. An Overview
   1. Some Observations on Traditional Finance Theory
   2. Some Observations on Stock Market Volatility

Part II: Share Valuation Theories

1. How to Value a Share
   1. The Capitalisation Concept
   2. The Capitalisation of Dividends and Earnings
   3. The Capitalisation of Current Maintainable Yield
   4. The Capitalisation of Earnings
2. The Role of Dividend Policy
   1. The Gordon Growth Model
   2. Gordon’s ‘Bird in the Hand’ Model
3. Dividend Irrelevancy
   1. The MM Dividend Irrelevancy Hypothesis
   2. The MM Hypothesis and Shareholder Reaction
   3. The MM Hypothesis: A Corporate Perspective

Part III: A Guide to Stock Market Investment

1. How to Read Stock Exchange Listings
   1. Stock Exchange Listings
2. Strategies for Investment (I)
   1. Dividends as Income
   2. Dividends for Growth
   3. The Price-Earnings Ratio: Past and Future
3. Strategies for Investment (II)
   1. Corporate Information
   2. “Beating” the Market

Part IV: Valuation and Takeover

1. A Stock Exchange Valuation
   1. Coming to the Market
   2. Calculations and Assumptions
   3. A Total Market Valuation
   4. An Aggregate Flotation Value
   5. The Number and Denomination of Shares
   6. A Valuation per Share
2. Managerial Motivation and Corporate Takeover
   1. Objective Motivational Factors
   2. Subjective Motivational Factors
3. Acquisition Pricing and Accounting Data
   1. Takeover Valuation: The Case for Net Assets
   2. Valuing the Assets
   3. How to Value Goodwill
4. Acquisition Pricing-Profitability, Dividend Policy and Cash Flow
   1. Takeover Valuation: The Profitability Basis
   2. Takeover Valuation: Dividend Policy
   3. Takeover Valuation: The Cash Flow Basis
5. Takeover Activity, Investor Behaviour and Stock Market Data
   1. The Current Takeover Scene
   2. Investor Behaviour
   3. The “Golden Rules” of Investment
   4. Acquisition Strategy and Stock Market Data

 Appendix: Stock Market Ratios