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Christian Angele
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"Investing in start-ups, interested in valuations in all-stages. Fundraising for investment funds etc."

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1. Quarterly Update of German Capital Market Data including Beta Factors, Multiples, and Yield Curves
2. Access to an Exclusive Library of High-Quality Research out of Practice and Academia
3. Trainings and Tutorials for Valuation Purposes 

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SEMINARS VALUATION | UNTERNEHMENSBEWERTUNG >Finanzplanung | DCF | LBO Strukturierung | Merger Modellierung

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NEWS: STUDIES > Performance

ZUKUNFT VON INSURTECH IN DEUTSCHLAND: DER INSURTECH-RADAR 2019

Oliver Wyman
What trends and changes are observable in the InsurTech industry this year? Oliver Wyman examines this question in the current "InsurTech-Radar 2019" and sheds light on what developments have taken place since the last radar at the end of 2017, how the market potential and chances of success for start-ups are and what forecasts Oliver Wyman is making for the future of InsurTech. >more

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STUDIES > Alternative Investments

DIGITAL AT THE SPEED OF PRIVATE EQUITY: HOW TO INCREASE EBITDA THROUGH DIGITAL INVESTMENTS IN THE MID-MARKET

West Monroe Partners
Digital transformation is fundamentally altering the way most industries do business. And in the sky-high valuation environment that has defined the PE market in recent years, the need to identify innovative and effective investment angles to create value has never been more pressing. Looking ahead, it is the ability of PE firms to develop digitally-led investment theses, carry out effective digital diligence, and deliver on their strategies that will separate the industry’s best and weakest performers in the years to come. >more

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STUDIES > Corporate Finance

WEM GEHÖRT DER DAX? ANALYSE DER AKTIONÄSSTRUKTUR DER DAX UNTERNEHMEN

Ernst & Young
German investors have little to gain from the DAX dividend record. Of the 36.5 billion euros distributed by DAX companies this year, only 12.5 billion euros will flow to German shareholders - a decline of 0.4 percent compared to the previous year. By contrast, the DAX groups transferred 19.8 billion euros to foreign investors - 4.8 percent more than in the previous year. For the remaining 4.2 billion euros, the nationality of the investors cannot be determined. The reason for the rising dividend payments to foreign investors: Foreign investors further increased their DAX exposure last year. >more

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STUDIES > Jobs | Opportunities

UPDATE ARBEITSRECHT JUNE 2019

CMS Hasche Sigle
Employment opportunities for older workers, in particular pensioners, have been improved by case law and legislation in recent years. Against the background of demographic change, this is an important building block in order to compensate for the existing shortage of skilled workers in many areas. In our main article, we will explain to you what design options you have. >more

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STUDIES > Corporate Finance

CROWDLENDING – EINE ALTERNATIVE FÜR UNTERNEHMEN?

Deloitte
Disruption of the banking market was prophesied to crowdlending. There was talk of high growth rates and a threat to banks. In addition to private peer-to-peer loans, swarm financing was considered to have great potential for financing small and medium-sized enterprises (SMEs). Deloitte had already taken this opportunity in 2015 to take a closer look at crowdlending in this important segment. The result back then: crowdlending was not yet a serious competitor for traditional bank loans. The interviewees felt that a personal relationship with their bank was too important for them to have considered the new financing option more closely. A repeat of the study in 2018 showed that although the general awareness of crowd lending had risen sharply, companies still indicated that their house bank was their preferred financing partner. >more

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STUDIES > Performance

TOP 1.000 WELT: DIE WELTWEIT UMSATZSTÄRKSTEN UNTERNEHMEN

Ernst & Young
While the largest North American companies were able to increase their sales by an average of 9.0 percent last year, the sales growth of major European companies averaged only 4.3 percent. Asia's large companies achieved growth of 8.4 percent. And Europe's top companies are also losing ground in terms of profit growth: in 2018, they were only able to increase their operating profit by 3.9 percent, while the US and Asian groups grew more than twice as fast at 8.1 and 9.8 percent, respectively.  >more

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NEWS: STUDIES > Corporate Finance

DER NEUE KREDITRISIKOSTANDARDANSATZ NACH BASEL IV

Deloitte
As a result of the adoption of CRR II, banks are currently paying particular attention to the imminent changes in capital requirements. In this White Paper, Deloitte describes the new regulations and also addresses the data requirements. In the course of test calculations, it has been shown that information is often missing in order to be able to calculate the new KSA correctly. From this, the need for action for IT can be derived. >more

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TUTORIALS > Valuation Video QoD21

Question of doubt in corporate valuation QoD#21: What is the circularity problem and is a Newton approximation a good way to solve it?

Bernhard Schwetzler
Working with the DCF-WACC approach in corporate valuation requires to assume the firm´s capital structure as weights for the cost of capital in market values. That implies a circularity problem as the market value of equity is what just is supposed to be calculated. A so called Newton approximation is sometimes recommended as a solution to this problem. This video shows how it works and discusses some pros and cons of this proposal. (May 22, 2019)
>more
(videoarchiv QoD#1-21) 

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UPDATE CAPITAL MARKET DATA

We updated the capital market data (Betas, Multiples, Returns) as to April15, 2019. For data access, you must be a basic finexpert member. >more

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RESEARCH PAPERS > Corporate Valuation

SAME, SAME BUT DIFFERENT: HOW PREFERENTIAL CLAIMS SKEW RETURNS OF VENTURE CAPITAL INVESTMENTS

Julian Kaboth, Arnd Lodowicks, Maximilian Schreiter, and Bernhard Schwetzler
2019
Venture capital often involves complex equity contracts, which affect the allocation of cash flows among shareholdings at an exit liquidation. To facilitate economic impact analysis, we structure exit relevant preferential rights by their economic impact in a two-dimensional framework. Based hereon, we provide a model that allows to assess ex-ante value of such shares. We apply our model to a selected sample of ventures and find an average overvaluation on a share class basis of 22.1% (median 23.9%), where overvaluation is particularly severe for common and early-on investments. >more

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GERMAN TAKEOVER REPORT 2019

The finexpert-ValueTrust German takeover report covers all takeover bids according to the German takeover code WpÜG of the year 2018 and provides extensive information on relevant variables like bid types, premia offered, market reaction of target’s and (if available) on bidder’s stock prices. In addition we compare last years figures of these variables against the moving average of the preceding years and thus to highlight trends and long term developments. The  report contains a unique and extensive  analysis  of  fairness  opinions  and  statements  of  management  and supervisory board of the target company (§27 WpÜG). We introduce an alternative success measure that takes potential bidder toeholds into account and perform additional analyses.Our results indicate 2018 as a year with an exceptionally low number of offers and small average bid premium. This report contains a detailed description of events surrounding the takeover and corresponding public delisting offer for STADA Arzneimittel AG, where Value Trust was acting as financial advisor.  Content: Market Overview |Capital Market Reaction |Statements & Fairness Opinions |Success Rates |Takeover Case Study: Stada Arzneimittel AG (Part II—Delisting)|Transaction Details 2018  >more

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STUDIES > Macro

GLOBAL MACRO TRENDS: THE UNCOMFORTABLE TRUTH

KKR - As the intensifying yearn for yield by investors increasingly bumps up against “the uncomfortable truth” of declining interest rates amidst soaring fiscal deficits and bulging debt loads, KKR’s Global Macro, Balance Sheet, and Risk Analytics team has analyzed what yield-oriented investors, especially those with large swaths of exposure to Fixed Income and Real Assets, can do to outperform without taking on undue risks in this environment. Our suggestion is to own more cash flowing assets linked to nominal GDP, build more flexibility across mandates, and shorten duration where appropriate. Importantly, despite our view that inflation will remain low in the medium-term, we respect that the ‘Authorities’ are trying shrink existing debt loads by holding nominal interest rates below nominal GDP. As such, we believe strongly that an overweight to modestly leveraged Infrastructure and certain Real Estate investments with yield is prudent to add some ballast to one’s portfolio. >more

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STUDIES > Alternative Investments

INVESTMENT SUCCESS ISN'T JUST ABOUT THE NUMBERS. IT'S ABOUT THE PEOPLE: SPECIFICALLY, THE PE-CEO-CFO RELATIONSHIP

Alix Partners
In our fourth annual private equity (PE) leadership survey, we take a closer look at the ongoing disconnect between portfolio company (portco) CEOs and their PE owners. This report, part one of two, focuses on three main themes: (1) Proactive management of the triangular relationship between PE sponsors and portco company CEOs and CFOs. (2) Early understanding of major misalignments related to the role of human capital in PE firms’ investment theses. (3) Disconnect between beliefs and behaviors with regard to predeal assessment of prospective portcos. >more

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STUDIES > Performance

(EM)POWER WOMEN: BCG GENDER DIVERSITY INDEX DEUTSCHLAND 2018 - WO CHEFETAGEN IN SACHEN VIELFALT STEHEN

The Boston Consulting Group
Germany's executive floors are still extremely male-dominated: in the 100 largest German listed companies there are only two female CEOs and just seven percent female board members. On the supervisory boards of these companies, every third member is now a woman. Five out of 100 supervisory boards have a female chairman. This means that the proportion of women at the top of companies - board members and supervisory board members combined - is still a low 19 percent. One could say that progress in Germany is slow at best. This is shown by the results of the BCG Gender Diversity Index 2018, presented by the Boston Consulting Group in cooperation with the Technical University of Munich. >more

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STUDIES > M&A

DACH CAPITAL MARKET STUDY

ValueTrust
The study was elaborated by ValueTrust Financial Advisors SE (ValueTrust) in cooperation with finexpert and the Institute of Auditing and Sustainability Accounting at the Johannes Kepler University Linz. This study provides a data compilation of the capital market parameters as of 31. December 2018 that enables an enterprise valuation in Germany, Austria and Switzerland. It has the purpose to serve as an assistant and data source as well as to show trends of the analyzed parameters. >more

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STUDIES > M&A

EUROPEAN CAPITAL MARKET STUDY

ValueTrust presents the second edition of the European Capital Market Study, which serves as a comprehensive compilation of capital market parameters such cost of capital and implied as well as historical risk premiums for European countries. The study also includes trading multiples and total shareholder returns across a wide range of industries. >more

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STUDIES > M&A

STUDIE ZUR BEWERTUNGSPRAXIS BEI GESELLSCHAFTSRECHTLICHEN ANLÄSSEN

I-Advise
The fifth edition of the study on German valuation practice in squeeze-outs, mergers and other legal measures according to German law has been complemented by reports with valuation dates in 2018 and analyses the development of valuation practice since 2010. The study can serve as a reference point for the most important parameters of valuations and offers an overview of solutions to a multitude of valuation questions by valuation professionals. >more

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STUDIES > Alternative Investments

PRIVATE MARKETS COME OF AGE

McKinsey & Company
Private markets stayed strong in 2018. True, fundraising was down 11 percent. But $778 billion of new capital flowed in. Investors have a new motivation to allocate to private markets: exposure. More investors believe that private markets have become effectively required for diversified participation in global growth. Global private equity (PE) net asset value grew by 18 percent in 2018; this century, it has grown by 7.5 times, twice as fast as public-market capitalization. Private markets, including PE, debt, infrastructure, real estate, and natural resources, have graduated from the fringes of the economy to the mainstream. >more

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STUDIES > Performance

BLOCKCHAIN AND THE DECENTRALIZATION REVOLUTION: A CFO’S GUIDE TO THE POTENTIAL IMPLICATIONS OF DISTRIBUTED LEDGER TECHNOLOGY

J.P. Morgan
With the advent of blockchain and increased adoption, J.P. Morgan’s Corporate Finance Advisory team, in conjunction with J.P. Morgan’s Digital Investment Banking team and Blockchain Center of Excellence, provides an informed view on the corporate implications of the rapidly changing interplay between finance and blockchain technology. Although the use of blockchain in the enterprise remains mostly in the proof-of-concept stage, CFOs and financial executives should continue to periodically evaluate the latest blockchain developments. >more

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STUDIES > Alternative Investments

EUROPEAN PRIVATE EQUITY OUTLOOK 2019

Roland Berger Strategy Consultants
Optimism in the private equity (PE) industry is significantly down on previous years. This is one of the findings of the new European Private Equity Outlook 2019, Roland Berger's annual survey of PE experts across Europe: In 2019, less than one third of those polled anticipate an increase in the number of M&A transactions with PE involvement. And for the first time in many years, almost half (48%) of PE professionals expect the number of transactions to fall this year. Geopolitical uncertainties and concerns about the economy are behind their pessimism. >more

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STUDIES > Accounting

PROGNOSEÄNDERUNGEN IM PRIME ALL SHARE 2011 BIS 2018: UPDATE FEBRUAR 2019

Ernst & Young
More and more listed companies in Germany have to correct their sales or profit forecasts: In 2018, companies listed in the Prime Standard issued a total of 144 profit or revenue warnings - an increase of 55 percent compared to 2017, when companies announced in 93 cases that they would not be able to achieve their targets. In 2016, only 63 of such warnings have been recorded. >more

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FINEXPERT COMMUNITY

We welcomed our 1.800th member! (February 2019) >more

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STUDIES > M&A

CHINESISCHE UNTERNEHMENSKÄUFE IN EUROPA: UPDATE FEBRUAR 2019

Ernst & Young
Chinese investors are becoming less and less active in Europe: last year, the number of takeovers and company investments throughout Europe fell by 21 percent to 196, and the investment volume even shrank by 46 percent to 31.2 billion US dollars. Germany also recorded a significant decline - the number of acquisitions and investments fell from 54 to 35. >more

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STUDIES > Macro

THE GLOBAL RISKS REPORT 2019

World Economic Forum
The report presents the results of our latest Global Risks Perception Survey, in which nearly 1,000 decision-makers from the public sector, private sector, academia and civil society assess the risks facing the world. Nine out of 10 respondents expect worsening economic and political confrontations between major powers this year. Over a ten-year horizon, extreme weather and climate-change policy failures are seen as the gravest threats. >more

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TUTORIALS > Valuation Video QoD20

Question of doubt in corporate valuation QoD#20: How does the debt policy affect the firm´s beta?

Bernhard Schwetzler
A debt policy describes the adjustment sequence of the firm´s debt level towards the level according to the optimal leverage ratio. This video explains how this choice affects the link between the firm´s asset (unlevered) and the firm´s equity (levered) beta. It also highlights that the well known "Hamada" equation is almost never the correct link. (January 18, 2019)
>more
(videoarchiv QoD#1-20) 

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UPDATE CAPITAL MARKET DATA

We updated the capital market data (Betas, Multiples, Returns) as to January 15, 2019. For data access, you must be a basic finexpert member. >more

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NEW THINK TANK FOR PRIVATE EQUITY

Prof. Dr. Bernhard Schwetzler and Dr. Benjamin Hammer, both part of the finexpert team, have re-launched the Center for Corporate Transactions & Private Equity (CCTPE) at HHL Leipzig Graduate School of Management with the aim to become the #1 think tank for Private Equity research in Germany. The purpose of the CCTPE is to foster high quality research output, and provide a platform for renowned scholars and industry professionals. The CCTPE is supported by various high-profile companies and individuals such as AssetMetrix; Astorius; Börsen-Zeitung; CatCap; Handelsblatt Media Group; Neuberger Berman; Nordic Capital; Palero; Skadden, Arps, Slate, Meagher & Flom; The Boston Consulting Group; ValueTrust, as well an HHL alumnus with an anonymous donation. Together with the Börsen-Zeitung, the new Center will organize the Private Equity & Venture Capital Summit 2019 as academic partner at March 27 and 28, 2019 in Munich. This summit serves as a high-level discussion platform for all relevant PE industry topics in the areas of finance, legal and tax. Inspiring panel discussion as well as network opportunities will provide insights into the latest industry developments. On the website of the CCTPE you can download recent papers and check the PE Buyout Database of the HHL Chair of Financial Management. >more

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CAPITAL MARKET REPORT 2018

finexpert | ValueTrust
The finexpert-ValueTrust Capital Market Report 2018 contains cost of capital developments over the last year, 1 and 2 Year Beta estimates since 2016 for the Prime All Share indices as well as Yield Curve estimates. The report is meant to be a comprehensive reference for cost of capital estimates where finexpert users can find sector-specific information for valuation purposes. Content: Cost of Capital: Q1-Q4 2018 (DAX, MDAX, TecDAX, 18 Sectors), CAPM: Beta Factor Development 2016-2018 (DAX, MDAX, TecDAX, 18 Sectors), Yield Curve: Svensson (1994)  (Teaser) >more

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TUTORIALS > Valuation Video QoD19

Question of doubt in corporate valuation QoD#19: Do I really need to care about a "debt policy" in DCF valuation?

Bernhard Schwetzler
Not too many analysts explicitly make an assumption about the firm´s debt policy, especially when using the WACC approach for corporate valuation. This video highlights that also under the WACC approach a debt policy has to be assumed in many cases as it affects the de-/re-levering equations of the beta factor.
(January 8, 2019). >more
(videoarchiv QoD#1-19) 

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STUDIES > Corporate Finance

WORKING CAPITAL REPORT 2018/19: NAVIGATING UNCERTAINTY

PwC
Cash is the lifeblood of any company. It’s more important than ever for businesses to optimise this fundamental aspect of financial performance if they’re to maintain a steady course in these uncertain times. Given that working capital is the cheapest source of cash, nothing is more vital than having a cash culture and good liquidity on board. If all the companies in this PwC study were to improve their working capital efficiency to the level of the next performance quartile, this would represent a cash release of €1.3tr. This would be enough for global companies to boost their capital investment by 55% – without needing to access additional funding or put their cash flows under pressure. >more

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STUDIES > Performance

DIGITALISIERUNG LÄUTET ZEITENWENDE IN DER RESTRUKTURIERUNG EIN

Roland Berger Strategy Consultants
In corporate restructuring, "analogue" practices have been in place for more than 30 years, but with the advent of the digital age, it is now time for the restructuring industry to leave traditional paths and look for new approaches. Consistent digitalization makes it possible to double efficiency by halving the process time for restructuring. >more

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STUDIES > Macro

GLOBAL OUTLOOK JANUARY 2019

The Economist
The Economist Intelligence Unit has revised its US monetary policy forecast. They have also made a slight revision to the US dollar-euro exchange-rate forecasts in 2019-20 as a result of fewer US rate increases in that period. The slower pace of monetary tightening in the US will also reduce the pressure faced by some emerging markets as a result of tightening global liquidity conditions, as has already been illustrated by the strengthening of many emerging markets' exchange rates against the US dollar over the past month. >more

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NEWS: STUDIES > Corporate Finance

IPO-STUDIE 2018

Kirchhoff Consult
Despite the high volatility on the capital market, 2018 was one of the best years for IPOs in Germany. This is the result of the annual IPO study conducted by the Hamburg agency for financial and corporate communications Kirchhoff Consult. According to this study, the number of IPOs (Initial Public Offering) in the Prime Standard stock market segment doubled to 16 compared to the previous year and thus reached its highest level since 2007. >more

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NEWS: STUDIES > Performance

FIVE TRENDS TO WATCH IN 2019

Barings
The past year has been a strange one for global growth as the recovery fell out of synch. While there were no obvious signs of recession as 2018 ended, it is hard to make the case for a global acceleration in the months ahead. This has left most investors looking for attractive valuations and strong balance sheets, as they look for signs that global growth may fade. >more

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STUDIES > Performance

IN SEARCH OF CUSTOMERS WHO LOVE THEIR BANK: CUSTOMER LOYALTY IN RETAIL BANKING REPORT

Bain & Company
With banks under attack from technology firms, their top priority should be improving the convenience and quality of the experience for customers. Loyalty stems from how well banks deliver value as perceived by consumers, which companies can measure through 30 Elements. The elements that have the greatest impact on loyalty in banking are quality, followed by saves time, reduces anxiety, simplifies and heirloom. On each of these five elements, at least one large tech firm performs better than survey respondents' primary bank. That helps tech firms earn customers' trust at a level near banks. >more

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STUDIES > Performance

OUTSOURCING IN DER FINANZINDUSTRIE

PwC
Outsourcing is an important part of the strategy of many financial institutions - not only as an instrument to reduce costs, but also to gain access to the expertise and knowledge of external service providers and FinTechs. The new PwC study analyses the framework conditions and identifies the most important trends in the outsourcing market. It surveyed 124 companies, including 32 banks, 53 service providers and 39 FinTechs. >more

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TUTORIALS > Valuation Video QoD18

Question of doubt in corporate valuation QoD#18: How can I distinguish between promised and expected yields when deriving the cost of debt?

Bernhard Schwetzler
The cost of debt take potential default into account and relate to the expected yield/return of the debtholder. This video shows how promised and expected yields can be derived based on a simple one-period binomial option pricing model. It requires some basic knowledge in option pricing theory
(November 23, 2018). >more
(videoarchiv QoD#1-18) 

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RESEARCH PAPERS > Alternative Investments

INITIAL COIN OFFERINGS (ICOS) TO FINANCE NEW VENTURES

Christian Fisch
2018
In an initial coin offering (ICO), new ventures raise capital by selling tokens to a crowd of investors. Often, this token is a cryptocurrency, a digital medium of value exchange based on the distributed ledger technology. Both the number of ICOs and the amount of capital raised have exploded since 2017. Despite attracting significant attention from ventures, investors, and policy makers, little is known about the dynamics of ICOs. This initial study therefore assesses the determinants of the amount raised in 423 ICOs. Drawing on signaling theory, the study explores the role of signaling ventures' technological capabilities in ICOs. The results show that technical white papers and high-quality source codes increase the amount raised, while patents are not associated with increased amounts of funding. Exploring further determinants of the amount raised, the results indicate that some of the underlying mechanisms in ICOs resemble those found in prior research into entrepreneurial finance, while others are unique to the ICO context. >more

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TUTORIALS > Valuation Video QoD17

Question of doubt in corporate valuation QoD#17: In case of defaultable debt: Can a firm´s cost of debt exceed its cost of equity?

Bernhard Schwetzler
Junk bonds may have yields well above 15%. The video discusses whether in this case cost of debt can exceed cost of equity. It also analyses whether bond yields are appropriate measures for the firm´s cost of debt
(November 16, 2018). >more
(Videoarchiv QoD#1-17)

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STUDIES > Performance

2018 EU-WIDE STRESS TEST RESULTS

European Banking Authority
The 2018 EU-wide stress test involves 48 banks from 15 EU and EEA countries, covering broadly 70% of total EU banking sector assets. The objective of the exercise is to assess, in a consistent way, the resilience of banks to a common set of adverse shocks. The results are an input to the supervisory decision-making process and promote market discipline. >more

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TUTORIALS > Valuation Video QoD16

Question of doubt in corporate valuation QoD#16: Is there a general, more flexible „debt policy“ than MM and/or ME?

Bernhard Schwetzler
This week´s QoD video introduces a general debt policy for corporate valuation models; the policy adjusts the level of debt towards a certain target value by multiplying the realized future firm value with a constant leverage ratio every k periods. The two well-known debt policies “MM” and “ME” are two polar cases of this general model. The video shows a general equation for the tax shield calculation and also gives a link of the general debt policy to default probabilities.
(November 9, 2018).(videoarchiv QoD#1-16) >more

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STUDIES > M&A

MORE RIGOR MEANS BETTER RESULTS IN CHINA’S GLOBAL PURSUIT

Bain & Company
More Rigor means Better Results in China´s Global Pursuit
As they make more overseas acquisitions, Chinese companies are learning the critical nuances that contribute to a deal’s success. As Chinese companies become more experienced at outbound M&A, they gain sophistication in critical capabilities, such as developing a clear investment thesis, due diligence and merger integration. >more

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STUDIES > M&A

DACH KAPITALMARKTSTUDIE

ValueTrust
In this study, ValueTrust provides the newest analyses of cost of capital parameters (risk-free rate, market risk premium) and capital market data (multiples, betas, returns) for the capital markets of Germany, Austria and Switzerland as of 30 June 2018. The study was compiled in cooperation with finexpert and the Institute of Auditing and Sustainability Accounting at the Johannes Kepler University Linz. >more

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UPDATE CAPITAL MARKET DATA

We updated the capital market data (Betas, Multiples, Returns) as to October 15, 2018. For data access, you must be a basic finexpert member.>more

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STUDIES > M&A

FINANZIERUNG VON FAMILIENUNTERNEHMEN IN DEUTSCHLAND

Roland Berger Strategy Consultants
Many German family businesses are successful worldwide. In financial matters, they are regarded as rather risk-averse, solidly equipped with funds and often debt-free. They are often less dependent on banks or other financial backers than comparable companies. However, this is changing because upcoming investments - including digitisation and further internationalisation of their business - exceed their financial firepower. >more

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STUDIES > Performance

CLOSING THE GAP: LEADERSHIP PERSPECTIVES ON PROMOTING WOMEN IN FINANCIAL SERVICES

McKinsey & Company
Where does the financial-services sector stand when it comes to gender equality? To answer the question, this article looks at the experiences of financial-services employees in North America, gathers insights from female senior leaders (those who have reached the level of vice president or above), and reviews best-practice policies and programs to promote diversity and inclusion. >more

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TUTORIALS > Valuation Video QoD13

Question of doubt in corporate valuation QoD#13: Is there anything special about negative Free Cash flows? (simple version) (Bernhard Schwetzler)

Negative Free Cash flows show up quite rarely in corporate valuation and valuators may sometimes be uncertain whether they require an adjustment. This video shows the potential reasons behind the negative sign of FCF and gives some guidance how to properly deal with it. (October 12, 2018).(videoarchiv QoD#1-13) >more

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NEWS: STUDIES > Performance

DAX-AUFSICHTSRÄTE UND VORSTÄNDE: INTERNATIONALITÄT UND VIELFALT

Ernst & Young
The executive boards of DAX companies became somewhat more international last year: between mid-2017 and mid-2018, the number of DAX board members holding a foreign passport rose from 67 to 69 - the proportion of foreign DAX board members thus rose from 35 to 36 percent. Conversely, the number of top managers with German (or dual) citizenship fell from 126 to 123. >more

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STUDIES > Performance

EINEN GANG HOCHSCHALTEN: WIE BANKEN DEN WETTBEWERB IM FIRMENKUNDENGESCHÄFT MEISTERN

Strategy&
Corporate Banking continues to be lucrative for banks in Germany: with an average return on equity of 10%, Corporate Banking made an important contribution to the profitability of banks in Germany last year. In 2017, the institutions in Germany generated income of around EUR 20 billion in the corporate customer segment. Of this, 66% was attributable to traditional lending business and 24% to cash management and trade finance products. The remaining 10% was distributed between investment banking services and financial markets products. >more

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STUDIES > Jobs | Opportunities

UPDATE ARBEITSRECHT SEPTEMBER 2018

CMS Hasche Sigle regularly publishes updates and news concerning the German labor law. Amongst others, this edition features updates on remuneration trends and legal principles. >more

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RESEARCH PAPERS > M&A

DO PRIVATE EQUITY FIRMS PAY FOR SYNERGIES?

Benjamin Hammer, Nils Janssen, Denis Schweizer, and Bernhard Schwetzler
2018
Stylized facts suggest that strategic acquirers can pay for synergies, while private equity (PE) firms cannot because of the missing operating fit with the portfolio company. However, if PE firms initiate buy-and-build strategies, there is potential for an operating fit between the portfolio firm and its add-on acquisitions. Thus, synergistic value could be priced in at entry. We analyze the pricing of 1,155 global PE buyouts and find strong support for a valuation effect from buy-and-build strategies. Our results indicate that PE sponsors pay a premium of up to 47% at entry when the portfolio company acquirers add-ons in the same industry within a two-year time window after the buyout. Consistent with bargaining power theory, the effect strengthens when the portfolio firm has acquisition experience, and when the PE sponsor faces pressure to invest because of unspent fund capital (referred to as “dry powder”) or deal competition. These findings remain robust after addressing alternative explanations, endogenous selection, and reverse causality. They have important implications for the literature on strategic versus financial bidders in takeovers. >more

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MULTIPLE REPORT 2018

finexpert | ValueTrust
The multiple report concentrates on market multiples of the German stock market (the forthcoming third market report will finally concentrate on industry betas and the Svensson curve). The multiple report gives a comprehensive overview over the market valuation of different indices of the German Prime All Share. It combines 5 different multiple definitions, 4 market indices, 15 industry indices, 3 aggregation methods and 2 different time dimensions (trailing vs. forward). Our data coverage starts in 2010 to ensure that data can be used for historical valuations and to exhibit time series trends. Detailed sector compositions for previous valuation data and further information on valuation as well as capital market issues are available at finexpert.info.  (Teaser) >more

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FINEXPERT COMMUNITY

We welcomed our 1.700th member! (August 2018) >more

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STUDIES > Performance

WELCHEN WERT HAT DER BITCOIN?

Deloitte
Bitcoin has the potential to fundamentally change the financial industry, trade and business models of many companies. But how do Bitcoin and Blockchain work exactly? And what do companies need to know in order to benefit from it? The Deloitte experts explain the functionality and possibilities of the virtual currency. >more

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STUDIES > Macro

HOW MUCH WILL A TRADE WAR HURT YOUR COMPANY?

The Boston Consulting Group
The trade dispute between the US and China continues to escalate. Tariffs of 25% have been imposed or announced on $50 billion of imports from China, and tariffs on a further $200 billion are now being reviewed. With some of the world’s largest trading relationships embroiled in an escalating trade conflict, how high might the cost to the global economy and to your firm be? >more

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TUTORIALS > Valuation Video QoD5

Question of doubt in corporate valuation QoD#5: Are there sanity checks for the growth assumptions in the terminal value calculation? (Bernhard Schwetzler)

The assumption about the permanent growth rate in the terminal value calculation is a standard battlefield in transaction negotiations. This video is first introducing the so called Gordon-Shapiro model for terminal value calculation and then shows that it is a powerful tool to check for reasonable growth assumptions and to sort out unreasonable ones. (Sorry for this video being so long; if you already know the Gordon-Shapiro model and are only interested in the sanity check you may jump to 16:40..)
(August 10, 2018). (videoarchiv)  >more

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NEWS: STUDIES > Performance

BLOCKCHAIN IN FINANCIAL SERVICES – MEHR ALS NUR EIN HYPE?

Ernst & Young
When it comes to blockchain technology, German banks, insurers and asset managers tend to wait and see. Hardly any company aims to lead the way as a pioneer in the field of blockchain. Most people also want to keep their hands off cryptocurrencies. These are the results of a PwC survey among managers of 300 banks, insurers and asset managers. >more

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NEWS: STUDIES > Macro

THE GLOBAL FINANCIAL AND MONETARY SYSTEM IN 2030

World Economic Forum
The Global Future Council on Financial and Monetary Systems published this report singling out three key aspects of the risks and challenges associated with the two seemingly opposed forces of decentralization and integration, to which the international financial architecture will need to adapt: 1) regulatory challenges; 2) the transformation of the financial system through digitization; and 3) current macroeconomic risks. >more

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STUDIES > Corporate Finance

WHAT REALLY MATTERS FOR A PREMIUM IPO VALUATION?

The Boston Consulting Group | HHL
Planning for an initial public offering is a lot like planning a wedding. Some factors that affect success, such as investor sentiment, are beyond a company’s control, while others, such as the offer price, can only be dealt with shortly ahead of the big day. But many others should be addressed proactively with thorough planning over an extended period. Indeed, new research by BCG finds that some of the most important factors driving a premium IPO valuation are those for which preparation should begin well before the opening bell rings. >more

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STUDIES > M&A

CHINESISCHE UNTERNEHMENSKÄUFE IN EUROPA: EINE ANALYSE VON M&A DEALS 2006-2018

Ernst & Young
The number of Chinese acquisitions in Europe continues to decline: In the first half of this year, there were 12 percent fewer takeovers and investments in Europe than in the same period last year. The absolute number fell from 126 to 111, and the investment volume even more than halved: From 31.6 to 14.9 billion US dollars. >more

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TUTORIALS > Valuation Video QoD1

Question of doubt in corporate valuation: WACC and target capital structure

Bernhard Schwetzler has started a Youtube channel titled „questions of doubt in corporate valuation”. In homemade video clips of max. length of 10 minutes he discusses and answers technical questions related to corporate valuation that may pop up in the day to day business of transaction advisors.  The first video in this sequence is discussing the question “WACC and target capital structure – gross debt or net debt?” (July 13, 2018) >more

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STUDIES > Performance

BLOCKCHAIN FOR FINANCE

Deloitte
Blockchain for Finance is a practical guide for finance organizations that want to understand options for blockchain and make effective decisions about moving forward. It features more than a dozen Frequently Asked Questions finance teams can use to make sense of blockchain technology, as well as a high-level roadmap for adoption. It also includes a seven-point checklist for CFOs who are thinking about embarking on the blockchain journey. >more

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STUDIES > Performance

EUROPEAN PRIVATE BUSINESS SURVEY 2018

PwC surveyed 2,447 entrepreneurs from 31 European countries for the European Private Business Survey, including 371 from Germany. The results indicate that the shortage of skilled workers is slowing down European economic growth and is becoming an ever greater problem for SMEs. And not only that: Overwhelming regulation and bureaucracy, the sluggish expansion of the digital infrastructure, the uncertainties caused by the Brexit and increasing protectionism are big concerns for medium-sized companies. >more

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STUDIES > Performance

VENTURE CAPITAL: TREIBSTOFF FÜR INNOVATIONEN, WACHSTUM UND WETTBEWERBSFÄHIGKEIT

Roland Berger Strategy Consultants
There is not enough venture capital in Germany. This means that there is a lack of funds for start-ups and innovations, which are indispensable for surviving the competition with other technology locations. In this study, Roland Berger, the Internet Economy Foundation and the Bundesverband Deutscher Kapitalbeteiligungsgesellschaften show how critical the situation is and what can be done. >more

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STUDIES > Corporate Finance

UNDERSTANDING THE BLOCKCHAIN REVOLUTION!

Deutsche Bank Research
When reporting on bitcoin, blockchain and cryptocurrencies these days, the speaker is faced with the question: Shall he discuss the technology or move directly to the presentation of the social and economic implications? Conveying a complex technology in just a few minutes is risky. In Alice's rabbit burrow, the speaker and his audience quickly lose track of each other. But the audience may also be left clueless by the direct presentation of the potentially revolutionary implications. In the face of this dilemma and the complexity of cryptosystems, we will try to shed light on the issue by means of metaphors. >more

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RESEARCH PAPER > Corporate Finance

BEYOND FINANCING: CROWDFUNDING AS AN INFORMATIONAL MECHANISM

Jordana Viotto da Cruz
Using a unique dataset built with publicly available data from Internet-based sources, and after controlling for alternative explanations, we empirically show that even when not successful on crowdfunding, thus not accessing capital, project owners may still decide to release the product in the market if contributions suggest positive valuation of the “crowd”. >more

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STUDIES > Alternative Investments

EUROPEAN PRIVATE EQUITY ACTIVITY REPORT 2017

Invest Europe
This annual survey, undertaken on behalf of Invest Europe, collects comprehensive and robust activity data on fundraising, investment and divestment from about 1,250 private equity and venture capital firms in Europe. The 2017 statistics cover 89% of the €640bn capital under management on the European market. >more

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STUDIES > Accounting

THE OUTLOOK FOR GLOBAL TAX POLICY IN 2018 Ernst & Young

Global and US tax reform, and the adoption of numerous international tax policy changes in 2018, are providing a catalyst for countries to pursue tax competitiveness in new and innovative ways. This is according to the EY The outlook for global tax policy in 2018, which combines insights and forecasts from EY tax policy professionals in 41 jurisdictions worldwide. >more

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GERMAN TAKEOVER REPORT 2018

finexpert | ValueTrust
The finexpert-ValueTrust German takeover report 2018 covers all takeover bids according to the German takeover code WpÜG of the year 2017 and provides extensive information on relevant variables like bid types, premia offered, market reaction of target’s and (if available) on bidder’s stock prices. In addition our extensive database allows to compare last year´s figures of these variables against the moving average of the preceding years and thus to highlight trends and long term developments. Finally the finexpert German takeover report contains a unique and extensive analysis of fairness opinions and statements of management and
supervisory board of the target company (§27 WpÜG), allowing for a detailed analysis of the relationship of these factors upon target stock price reaction and success rates of the takeover bid. After discussing potential shortcomings of “traditional” success definitions of takeover offers in this report we introduce a new success measure that takes potential bidder toeholds into account and perform additional analyses. Our results indicate 2017 as a year with a lower number of offers, but due to one large bid, with significantly above average bid volume. This is due to the public exchange offer to Linde AG made by Linde PLC preceding the merger between Linde and Praxair. Premium offered and target CARs were below average in 2017. This report contains a detailed description of events surrounding the takeover offer for STADA Arzneimittel AG, where Value Trust was acting as financial advisor.  (Teaser) >more

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STUDIES > Corporate Finance

FINANCING THE DEEP TECH REVOLUTION

European Investment Bank
The European Investment Bank (EIB), with Oliver Wyman’s support, has developed and published a study on “Financing the Deep Tech Revolution”, identifying the obstacles to access-to-finance for deep tech companies as well as recommending policy measures to address them. >more

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STUDIES > M&A

RISING TENSION: ASSESSING CHINA'S FDI DROP IN EUROPE AND NORTH AMERICA

Baker & McKenzie
In 2017, China's global outbound investment dropped for the first time in more than a decade as policy changes in China and host economies cooled M&A activity and created a shift in the industries and geographies targeted by Chinese investors. This report provides insight into how and why China’s outbound investment patterns are changing in the world's two highest income regions: Europe and North America. >more

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STUDIES > Performance

BANKING ON BLOCKCHAIN: A VALUE ANALYSIS FOR INVESTMENT BANKS

Accenture
Many analysts liken the disruptive potential of blockchain's distributed ledger technology — a new type of database system — to that of the Internet. In addition to reshaping the financial infrastructure as we know it, this research pinpoints where blockchain will have the biggest impact on a bank's bottom line. To conduct the study, Accenture joined forces with McLagan, a business unit of Aon plc, and world-class capital markets benchmarking provider. >more

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STUDIES > Performance

BANKENREPORT DEUTSCHLAND 2030

Oliver Wyman
The German banking system faces radical changes: In 10-15 years, Germany will only have around 150 to 300 banks with sustainable and successful business models, compared to today's 1,600. Competition is increasing and more and more foreign banks, fintechs, market infrastructure providers and global technology groups are entering the German banking business. At the same time, digitization is making customers increasingly demanding. >more

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STUDIES > Corporate Finance

EFFIZIENZ DER KREDITPROZESSE IN DEUTSCHEN KREDITINSTITUTEN 2017

PwC
How efficient are credit processes in German banks? What are the implications of digitization in the lending business? Which distribution channels are still needed for lending? This PwC study addresses these and other questions. The results show that developments in retail and wholesale banking are far apart. And fewer houses than expected are already implementing a viable digitization strategy. Only a missed opportunity - or at least a danger for a successful future? >more

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STUDIES > Performance

DEUTSCHLANDS BANKEN 2017: METAMORPHOSE IM LAUFENDEN BETRIEB

Bain & Company
The structural change in the banking sector continues with increasing speed: on average, 36 bank branches close down operations every week in Germany and one bank even leaves the market. At the same time, the number of employees in the banking industry is falling by more than 400 per week. >more

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STUDIES > M&A

CHINESISCHE UNTERNEHMENSKÄUFE IN EUROPA: EINE ANALYSE VON M&A DEALS 2006-2017

Ernst & Young
In 2017, Chinese buyers invested a record amount of money in German companies with the total M&A volume amounting to just under 13.7 billion dollars. At the same time, the number of takeovers by Chinese investors declined by 21 percent to 54 transactions. >more

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STUDIES > Macro

THE GLOBAL RISKS REPORT 2018

World Economic Forum
Each year the Global Risks Report works with experts and decision-makers across the world to identify and analyze the most pressing risks that we face. As the pace of change accelerates, and as risk interconnections deepen, this year’s report highlights the growing strain we are placing on many of the global systems we rely on. >more

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BETA REPORT 2017

finexpert | ValueTrust
The beta report contains cost of capital developments over the last year, 1 and 2 Year Beta estimates since 2015 for the Prime All Share indices as well as Yield Curve estimates. The report is meant to be a comprehensive reference for cost of capital estimates where finexpert users can find sector-specific information for valuation purposes. We also provide an update about the newest academic research on cost of capital and related topics. The paper that we present discusses the use of gross versus net debt for unlevering/re-levering the beta factor (Teaser). >more

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TRAINING > Tutorials

Zwei Probleme der Unternehmensbewertung: Kapitalstruktur und Wachstum

Prof. Dr. Bernhard Schwetzler
This video shows a presentation of Professor Bernhard Schwetzler at the 11th annual meeting of the EACVA about common issues in corporate valuation: capital structure and beta adjustments with respect to the use of gross or net debt, as well as growth and the "steady state" assumption. >more

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STUDIES > Alternative Investments

PRIVATE EQUITY UND LEVERAGE IN DEUTSCHLAND - AKTUELLE ERGEBNISSE

HHL Leipzig Graduate School of Management
This presentation by Prof. Dr. Bernhard Schwetzler reports the results of two recent studies on leverage and default probabilities of private equity portfolio companies in Germany. The results indicate that static leverage ratios such as debt to total assets increase moderately after the PE entry, whereas dynamic measures such as debt to EBITDA are largely unaffected. Further results suggest that the business model of the PE firm, in particular its industry specialization, is crucial for default probabilities. >more

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GERMAN TAKEOVER REPORT 2017

finexpert | ValueTrust
The finexpert-ValueTrust German takeover report 2017 covers all takeover bids according to the German takeover code WpÜG of the year 2016 and provides extensive information on relevant variables like bid types, premia offered, market reaction of target’s and (if available) on bidder’s stock prices. In addition our extensive database allows to compare last year´s  yxfigures of these variables against the moving average of the preceding years and thus to highlight trends and long term developments. Finally the finexpert German takeover report contains a unique and extensive analysis of fairness opinions and statements of management and supervisory board of the target company (§27 WpÜG), allowing for a detailed analysis of the relationship of these factors upon target stock price reaction and success rates of the takeover bid. Our results indicate 2016 as a year with an average number of offers, but with above average premia and bid volume. The latter is due to the extraordinary merger attempt of Deutsche Börse and London Stock Exchange. Market reaction on the offer announcements was on average 20.8% on the targets (-+1 day-CAR). Our Fairness Opinion analysis reveals an increasing importance of consultants as providers. (Teaser) >more

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RESEARCH PAPERS > Corporate Valuation

THE IMPACT OF TERM STRUCTURE AND TERM TRANSFORMATION STRATEGIES ON THE CORPORATE VALUE OF BANKS – A COMPARISON BETWEEN CONTROLLING-BASED VALUATION CONCEPTS AND DCF-MODEL

Bernhard Schwetzler
2016
This paper compares two different concepts for bank valuation: a controlling-based concept splitting the bank into three parts (credit-, deposit-, and treasury bank) and valuing them separately, against a standard DCF-Flow to Equity valuation model. The controlling-based concept allows to separate current realized and future expected interest income generated by term transformation, i.e. by exploiting differences between different maturities via maturity mismatch of assets and liabilities, from the bank´s excess interest income (or interest savings) against market interest rates with the same TM. The results show that depending on the shape of the term structure and the term transformation strategy chosen by the bank´s management significant differences between the corporate values derived by the two valuation models may occur when being applied upon the same bank. >more

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STUDIES > Corporate Finance

Valuation of innovative business models

Bernhard Schwetzler
A talk on the valuation of innovative business models given at the annual meeting 2016 German Academic Association for Business Research (VHB) at the technical university of Munich TUM. (in German) >more

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FINEXPERT GERMAN TAKEOVER REPORT 2016

The  finexpert - ValueTrust German takeover report 2016 covers all takeover bids according to the German takeover code WpÜG of the year 2015 and provides extensive information on relevant variables like bid types, premia offered, market reaction of target’s and (if available) on bidder’s stock prices. In addition our extensive database allows to compare last year´s figures of these variables against the moving average of the preceding years and thus to highlight trends and long term developments. Finally the finexpert German takeover report contains a unique and extensive analysis of fairness opinions and statements of management and supervisory board of the target company (§27 WpÜG), allowing for a detailed analysis of the relationship of these factors upon target stock price reaction and success rates of the takeover bid. > more (Teaser) >more

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