Coursework Brief and Case Study
Read the news announcement ‘SABMiller and AB InBev agreement in principle and extension of PUSU deadline' from SABMiller website to perform the following tasks of analysis and write up your finding in a report format.
You are encouraged to conduct research on the effects of the news on share price. All related regulatory announcements can be found (as of Wednesday 14 October 2015) at the following website: https://www.sabmiller.com/investors/ABInBev-Possible-Offer
This is an ongoing case of M&A, one of the biggest in the UK. The study should emphasize the state of the play, valuation and trading strategy going forward. The students are encouraged to take a forward looking view on the future of acquisition event.
• Conduct in-depth background research to enhance the analysis of the acquisition event. Such research should demonstrate in-depth understanding on the working of the sector. You should set up a timeline to reflect the chronicle of events based on key dates.
• Conduct comprehensive valuation on SABMiller and AB InBev prior to the acquisition announcement. Your valuation should use relevant valuation technique(s) to arrive at an appropriately discounted present value (per share) for SABMiller and AB InBev.
• Evaluate the extent of price impacts on SABMiller and AB InBev following the news announcements on acquisition. Does the movement of share price reflect the insights from Efficient Market Hypothesis (EMH)?
• Conduct event analysis to test EMH and derive your trading profit from the event. An event analysis template is provided separately based on Chapter 14 contents of Simon Benninga textbook ‘Financial Modelling (4th edition)'.
• You are required to demonstrate trading strategies and instruments that would be appropriate to exploit price efficiency/inefficiency during the process of acquisition. Your analysis should forecast possible trading profit going forward.
Key Learning Outcomes
• Demonstrate knowledge of the purpose and functions of global financial markets
• Analyse the role of financial market data in supporting business decisions
• Critically evaluate the impact of the global financial markets on the business environment
• Demonstrate the ability to analyse and present quantitative data to support an argument.
• Use information technology to analyse and communicate financial data
• Reflect on your own ability to interpret and act upon the changing business environment.
Attachment:- event studies template.rar