Refine
Document Type
- Article (9)
- Working Paper (5)
- Report (3)
- Doctoral Thesis (1)
- Review (1)
Keywords
- Berufsbildung (2)
- Default risk (2)
- Digitale Kompetenz (2)
- Digitale Transformation (2)
- Insolvenzrisiko (2)
- Liquidation preferences (2)
- Optimal capital structure (2)
- Preferential claims (2)
- Real options (2)
- Tiefeninterview (2)
The new bond on the block
(2024)
Over the last decade, the green bond market experienced strong growth rates fueled by the need to combat climate change. However, the discourse on enhancing the effectiveness of green bonds primarily revolves around regulatory measures, often overlooking the possibility of designing inherent incentives. We show that a green bond with a coupon structure positively related to the carbon price development stimulates (early) investment in an emission-reducing project and creates higher net present values (NPVs) when applied in project financing. In our simulation-based framework, we model carbon prices using a geometric Brownian motion, and create a general optimal stopping time problem regarding the start of the project. The green bond in our setting carries the risk of default, also mitigated by its carbon price-linked coupon structure.
Panacea for M&A dealmaking?
(2023)
We survey 129 investors from private equity firms, investment banks, corporate M&A and other M&A-related roles about their perception of earnouts. The results indicate that earnouts are applied to reduce information asymmetries and to bridge negative agreement zones in transactions. While these findings are largely aligned with the academic perspectives, we reveal several discrepancies to existing theory with respect to motives, valuation and associated costs. This is the first study that incorporates the view of M&A professionals and thus attempts to bridge the gap between academics and professionals. In addition, it provides impulses for further academic work on earnouts.
The introduction of ChatGPT in November 2022 by OpenAI has stimulated substantial discourse on the implementation of artificial intelligence (AI) in various domains such as academia, business, and society at large. Although AI has been utilized in numerous areas for several years, the emergence of generative AI (GAI) applications such as ChatGPT, Jasper, or DALL-E are considered a breakthrough for the acceleration of AI technology due to their ease of use, intuitive interface, and performance. With GAI, it is possible to create a variety of content such as texts, images, audio, code, and even videos. This creates a variety of implications for businesses requiring a deeper examination, including an influence on business model innovation (BMI). Therefore, this study provides a BMI perspective on GAI with two primary contributions: (1) The development of six comprehensive propositions outlining the impact of GAI on businesses, and (2) the discussion of three industry examples, specifically software engineering, healthcare, and financial services. This study employs a qualitative content analysis using a scoping review methodology, drawing from a wide-ranging sample of 513 data points. These include academic publications, company reports, and public information such as press releases, news articles, interviews, and podcasts. The study thus contributes to the growing academic discourse in management research concerning AI’s potential impact and offers practical insights into how to utilize this technology to develop new or improve existing business models.
Im Rahmen des Zert-Ex Projektes verantwortet die HHL als einer der Verbundpartner die wissenschaftliche Erhebung des Kompetenzbedarfs von Mitarbeitenden im digitalen Transformationsprozess. Die ermittelten Kompetenzen sind Grundlage der inhaltlichen Ausgestaltung des innovativen Zert-Ex-Lehrgangs. Die Kompetenzbedarfsanalyse bezieht explizit die Perspektiven von Personalverantwortlichen, Führungskräften und anderen lehrgangsrelevanten Mitarbeitenden ein. Die Erhebungen werden in ganz Deutschland durchgeführt, und es wird versucht, mögliche regionale Unterschiede zu erfassen. Um den sich stetig – und vor allem schnell – wandelnden Anforderungen im Rahmen der digitalen Transformation gerecht zu werden, werden die benötigten Kompetenzen dynamisch in regelmäßigen Abständen (2x pro Jahr) erfasst. Innerhalb dieses iterativen Prozesses ist es der Anspruch der HHL, im weiteren Sinne, die „Echtzeiterfassung“ des Kompetenzbedarfs zu ermöglichen, auf deren Basis die Lehrgänge ausgestaltet und feinjustiert werden können.
Im Rahmen des Zert-Ex Projektes verantwortet die HHL als einer der Verbundpartner die wissenschaftliche Erhebung des Kompetenzbedarfs von Mitarbeitenden im digitalen Transformationsprozess. Die ermittelten Kompetenzen sind Grundlage der inhaltlichen Ausgestaltung des innovativen Zert-Ex-Lehrgangs. Die Kompetenzbedarfsanalyse bezieht explizit die Perspektiven von Personalverantwortlichen, Führungskräften und anderen lehrgangsrelevanten Mitarbeitenden ein. Die Erhebungen werden in ganz Deutschland durchgeführt, und es wird versucht, mögliche regionale Unterschiede zu erfassen. Um den sich stetig – und vor allem schnell – wandelnden Anforderungen im Rahmen der digitalen Transformation gerecht zu werden, werden die benötigten Kompetenzen dynamisch in regelmäßigen Abständen (2x pro Jahr) erfasst. Innerhalb dieses iterativen Prozesses ist es der Anspruch der HHL, im weiteren Sinne, die „Echtzeiterfassung“ des Kompetenzbedarfs zu ermöglichen, auf deren Basis die Lehrgänge ausgestaltet und feinjustiert werden können.
Same same but different
(2023)
Venture capital (VC) often involves complex equity contracts with so-called preferential rights affecting the allocation of exit proceeds among different share classes and investors. We structure exit-relevant preferential rights in a two-dimensional framework and develop a contingent claims model that allows for ex-ante valuation of separate shareholdings. The model generates insights on the valuation effects of varying setups in VC financing and indicates considerable mispricing potential of VC investments when applying commonly used heuristics such as the most recent funding round. Applying the model to a sample of ventures indicated an average ’overvaluation’ on a per-share basis of 26.7%, with common stocks and early-stage investments being the most affected. In addition, our analysis provides different implications regarding the effects of preferential right structuring for early and late stage investors.
Same, same but different
(2020)
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.
The article addresses the choice between setting up a project entity and integrating the project into a corporation from the perspective of a dynamic corporate finance model in the absence of operational syn-
ergies. The analysis builds upon a classic continuous-time framework with tax benefits of debt, costs of default and, more innovatively, a benefit or cost of abandonment derived for two projects with stochastic, correlated revenues. By implementing the model with a simulation-based approach, I show that foremost high correlations, high volatilities and high portions of fixed costs as well as heterogenous volatilities, bankruptcy costs and operational cost structures stimulate independent project structures. Further, a more difficult or costly access to external funds raises the benefits of merging activities in a combined firm.
Inhaltsübersicht
I. Insolvenz und Unternehmensbewertung – das Problem
II. Der Vorschlag von Meitner/Streitferdt
III. Die Beurteilung des Modellvorschlags
1. Zur Modellkonstruktion allgemein
2. Insolvenzwahrscheinlichkeiten und erwartete Insolvenzkosten
3. Zum Verhalten der Kreditgeber
4. Zum Verhalten der Eigentümer
5. Die Fremdkapitalkosten
6. Die Eigenkapitalkosten
7. Die Maximierung des Unternehmenswertes
IV. Fazit
Die HHL ist dank zahlreicher Initiativen seit vielen Jahren eng mit dem mitteldeutschen Mittelstand verwoben. Hierbei sei exemplarisch auf das Institut für Familienunternehmen & Unternehmernachfolge (IFU) verwiesen, welche derzeit zum Thema Digitalisierung eine neue Mittelstandsuntersuchung durchführt. Vorläufige Ergebnisse dieser zweistufigen Befragung, an der bisher 109 sächsische KMU teilnahmen, sind neben der dezidierten Abbildung des Status Quo vor allem die Identifikation konkreter Bedarfe der regionalen KMU. Die Erkenntnisse der Befragung sind in dieser vorläufigen Studie zusammengeführt. Auf ihrer Basis sind Ableitungen getroffen worden für die künftigen Angebote, die der DIGITAL SPACE der HHL den mitteldeutschen KMU ab 2020 unterbreiten möchte, um deren Digitale Transformation zu unterstützen und die Wettbewerbsfähigkeit der Region zu stärken.
This cumulative dissertation extends the literature strand on dynamic trade-off models in corporate finance. While Kane et al. (1984) and Fischer et al. (1989) have been probably first in developing dynamic trade-off models incorporating the effects of debt financing, it was Leland (1994) that really started the contingent claims revolution in corporate finance (Strebulaev and Whited, 2011, p. 25). Over the last 25 years, a whole strand of literature extended Leland's basic model to shed light on various financial decisions. To just provide some examples: Goldstein, Ju, and Leland (2001) based their model on a stochastic EBIT-process and allowed for an option to increase debt in order to understand the dynamic adjustment of capital structures. Strebulaev (2007) included external shocks into his capital structure models and gave indications on how capital structure tests shall be conducted. The contributions achieved in the essays of this dissertation focus on (i) more realistic conditions of default, (ii) an improved understanding of observed debt maturities and (iii) capital structures, (iv) the risk of applying the Equity IRR in financial decision making, as well as (v) the optimal choice between project financing and corporate financing.
Der Einfluss von Insolvenz, Kapitalstruktur und Fremdkapitalfälligkeit auf den Unternehmenswert
(2018)
Dieser Beitrag analysiert den Einfluss von Insolvenz und Finanzierungsstrategie auf den Wert eines Unternehmens. Neben der gewählten Kapitalstruktur wird auch die Wahl der Laufzeit des Fremdkapitals berücksichtigt. Mithilfe geschlossener Bewertungsgleichungen wird der Einfluss der gewählten Finanzierungsstrategie auf die Barwerte der Steuervorteile, der Refinanzierungs- sowie der Insolvenzkosten ermittelt. Weiterhin können die Unternehmenswert-maximierende Kapital- und Fälligkeitsstruktur, der nominelle Zinssatz, den die Fremdkapitalgeber für das übernommene Risiko verlangen, sowie die Insolvenzwahrscheinlichkeit bestimmt werden. Die Modellergebnisse bzgl. der Relation zwischen Fälligkeits- und Kapitalstruktur sowie der Insolvenzwahrscheinlichkeit liegen innerhalb der Bandbreite empirischer Observationen. Der Unternehmenswert hängt nicht nur vom klassichen Trade-Off zwischen Steuervorteilen und Insolvenzkosten, sondern ebenfalls von der Abwägung des Vorteils einer kurzfristigen Anpassung des Fremdkapitalbestandes an die ökonomische Situation des Unternehmens und den damit verbundenen Refinanzierungskosten ab.
finexpert.info veröffentlicht in Zusammenarbeit mit ValueTrust jährlich den Takeover Report Deutschland. Der Report gibt einen fundierten Marktüberblick über öffentliche Übernahmen in Deutschland. Dieser Beitrag fasst die Ergebnisse des Reports 2017 zusammen._x000D_ finexpert.info and ValueTrust regularly compile and publish the German Takeover Report, aiming to give a qualified overview over German public takeover offers. This article is summarizing the main results on the 2017 issue. We find an average number of takeover offers, but due to a very large merger attempt an above average offer volume. Offered premia, capital market reaction and target management communication is in line with long term trend.
Existing dynamic capital structure models are based on a single barrier determining bankruptcy, e.g. overindebtedness or illiquidity. However, it is observable that these approaches do not perform well empirically and omit a variety of constraints faced by equity and debt holders. This article incorporates these constraints examining corporate debt value and optimal capital structure in a double barrier world with knock-in and knock-out barrier options. The results elucidate why considering only one barrier distorts the estimates of risks for default and bankruptcy. In fact, the single barriers illiquidity and overindebtedness take the role of boundary conditions. Incorporating both conditions in this novel double barrier approach allows for capital structure estimations that are in better accordance with empirical findings. Beyond capital structure theory, other fields of economics and even medical science or the humanities are in context of problems that can be solved with such a double barrier approach._x000D_ Keywords: Dynamic models, structural estimation, first hitting time, second hitting time, default risk, optimal leverage_x000D_ JEL Classification: G12, G31, G32, G33
finexpert.info veröffentlicht in Zusammenarbeit mit ValueTrust jährlich den Takeover Report Deutschland. Der Report gibt einen fundierten Marktüberblick über öffentliche Unternehmenstransaktionen in Deutschland. Dieser Beitrag fasst die Ergebnisse des Reports 2016 zusammen. Trotz der seit 2009 niedrigsten Anzahl von Übernahmeangeboten (21) lag im zurückliegenden Jahr 2015 wegen eines großen Angebotes das durchschnittliche Volumen mit 663 Mio € deutlich über dem langjährigen Durchschnitt. Die (bereinigte) Angebotsprämie, die Kapitalmarktreaktion und die Anzahl/Aussagen der Stellungnahmen und Fairness Opinions lagen im langjährigen Trend._x000D_ finexpert.info and ValueTrust regularly compile and publish the German Takeover Report, aiming to give a qualified overview over German public takeover offers. This article is summarizing the main results on the 2016 issue. We find a low number of takeover offers, but due to a very large offer an above average size of the offers. Offered premia, capital market reaction and target management communication are in line with long term trend.
The internal rate of return (IRR) is still a widespread criterion for iestment decisions, although many pitfalls are well known. This paper provides evidence for another, more fundamental, dark side of IRR: Based on a dynamic model of optimal capital structure with endogenous bankruptcy trigger and risk-adjusted yield of debt we show that capital structures maximizing IRR are suboptimal, i.e., not value maximizing. The IRR criterion triggers the choice of higher leverage increasing the risk of default. Depending on the parameter setting the net benefit of financing reduces by up to 50 per cent. As optimizing the financing structure based on IRR is popular in PE related settings, our results are especially important for this industry.
Modelling dynamic redemption and default risk for LBO evaluation: a boundary crossing approach
(2015)
In this paper, we develop a model that allows evaluating the financial effects of leveraged buyouts (LBOs) from the perspective of the iestor. We provide explicit form solutions for all payoffs from acquisition to exit, and therefore feature the determination of net present value (NPV) and internal rate of return (IRR). The model is based on a boundary crossing approach where the default of the target firm is represented as a lower piecewise linear barrier. Those default barriers either consist of debt repayment and interest expenses, or are contractually-fixed by covenants like debt-to-EBITDA. Our approach features the typical LBO debt repayment schedules: fixed and cash sweep. Furthermore, the model captures all drivers of performance and leverage identified by empirical studies: firm-specific ones like profitability, cash flow growth, volatility and liquidation value, as well as external ones like credit risk spreads and pricing discounts for debt overhang.