- resources in finance

Valuing a Business 

  • Liquidation Value
  • Breakup Value
  • Using comparables
  • Going Concern Value
  • Value in the Context of M&A, Distress and Restructurings
Ian Giddy has taught finance at NYU, Columbia, Wharton, Chicago and in 30+ countries abroad for the past two decades. He was Director of International Fixed Income Research at Drexel Burnham Lambert from 1986 to 1989. The author of more than fifty articles on international finance, he has served at the International Monetary Fund and the U.S. Treasury and has been a consultant with numerous corporations and financial institutions in the U.S. and abroad. As a banker and consultant he has been involved in the application of applied corporate finance in the USA, Europe and Asia. He is the author or co-author of The International Money Market , The Handbook of International Finance, Cases in International Finance , Global Financial Markets, Asset Securitization in Asia and The Hudson River Watertrail Guide.


Corporate Valuation and Analysis
for Relationship Managers

Prof. Ian Giddy
New York University

What is my client company's value? What are the ratios used by analysts to determine what a company is worth? How valid is the discounted present value approach? How can we value a company as a going concern, and how does this change in the context of a potential acquisition or restructuring?


This program was designed for a broad range of relationship managers within Union Bank of California and was intended to teach participants how to expand the bank’s share-of-wallet within their target client-base. 

The objective was to equip delegates with core corporate valuation skills and best practices in relationship banking techniques so they can position and present financial solutions that optimize the bank-client relationship and profitability. 


Participants should be fully proficient with Excel and/or an HP-12C (or equivalent) financial calculator.  There are no other prerequisites other than the willingness to learn and participate in the program and the determination/fortitude necessary to tackle a rigorous program.


Day 1

Valuation Methods

Morning: Applying Valuation Techniques to Client Situations

Afternoon: Valuation Methods

Day 2

Valuation Applications

Morning: Valuing a Public Company in Transition

Afternoon: Valuing a Private Company


Module 2 (1 day)

Relationship Management in Action

Morning: Using the Tools of Corporate Finance to Identify Client Needs

Afternoon: Using the Bank’s Resources to Solve Client Problems


Day 1

Valuation Methods


Introduction and Overview

Applying Valuation Techniques to Client Situations

  • Valuation as a tool to discover factors driving the business
  • Valuation as a tool to discover restructuring opportunities and deal ideas

Valuation and financing choices

  • The key role of the cost of capital and capital structure
  • Special considerations as to the client’s creditworthiness
  • Banking applications and their ties to valuation techniques

Case study: Photronics

A technology company is seeking additional financing. The bank has been asked to price a $150 million loan, but the RM has learned that a convertible bond is also under consideration. What effect is each likely to have on the company’s value, and how can this analysis be used as a selling tool?


Valuation Methods

  • Asset-based valuation
  • Replacement value
  • Intangibles
  • Breakup value
  • Liquidation value
  • Using comparables
  • Defining peer groups and making adjustments

Discounted free cash flow analysis

  • Measuring and predicting cash flows
  • Key assumptions and sensitivities
  • Comparables and peers again
  • Turnaround situations
  • Option-based valuation

When to use what techniques

Case study: Cap des Biches Acquisition

Day 2

Valuation Applications


Review of Concepts and Applications

Valuing a Public Company

  • Why market value may mislead
  • Agency costs and the market for corporate control
  • Valuing a company “in play”

Valuation in an Acquisition Context

  • Values of stand-alone participants in a merger
  • Value of operating synergies
  • Value of financial restructuring
  • Valuing negative synergies
  • Merged company value

Valuing a Public Company in Transition

  • Turnaround situations
  • Valuation of divestitures
  • Valuation in situations of financial distress

Case study: Valuing ATT Wireless

How should ATT Wireless be valued? What can the balance sheet and other financial statements tell us, and how can we project the company's free cash flows to estimate its going-concern worth? What factors could change this valuation? What would the company be worth to an acquirer? How can this approach help drive banking deals?


Valuing a Private Company

  • Special problems and considerations
  • Technical aspects of private company valuation, including book, replacement, liquidation, comparables and DCF valuation
  • Using online comparable data
  • Illiquidity premium
  • Private ownership complications that affect value

The Venture Capital Method

  • Private equity financing and key role of valuation
  • Leveraged finance and debt capacity analysis
  • VC required returns and principal valuation

Case study:Flexics

The controlling owner of this Seattle-based plasma technology company is seeking a means of realizing its corporate value. What would it be worth in the market, and could it be worth more to LBO investors? What is Flexics worth as an acquisition target to Photronics, and how much of a premium should be paid? What restructuring could add value? What could the bank bring to the deal?

Review and Summary

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Copyright ©2005 Ian Giddy. All rights reserved