AØKA08093U Private Equity – From Venture Capital to Buyouts

Volume 2014/2015
Education
MSc in Economics
The course is part of the Financial line symbolized by "F".
Content

The course is a joint University of Copenhagen Department of Economics/Faculty of Law graduate course introducing students to key aspects of private equity. The course is designed to be of interest to students of law, economics, finance and public policy, emphasizing the interrelationships between academic disciplines within this field.

Learning Outcome

To obtain a 12 grade students should demonstrate a thorough understanding of micro and/or macro aspects of private equity in broad terms and/or a thorough understanding of a particular topic within the overall framework of the course.
On a macro level, students should demonstrate a thorough understanding of industry drivers, such as the growth in savings deployable, the effects of corporate governance and regulation on the attractiveness of private versus public capital as well public policy issues such as transparency, any systemic risks associated with financial innovation and in particular the trading and transfer of risks and taxation.

On a micro level, students should demonstrate a thorough understanding of the structures and workings of private equity firms, in particular on the screening, investment, value creating and exit cycle, on capital structure issues as related to the stage and risk profile of portfolio companies, on the control and agency issues related to governance as well as of the contracts used to regulate principal/agent relations and to ensure alignment of interest, both in relation to limited partners and general partners and in relation to portfolio companies.

As this is a multi disciplinary course, students may select a topic of their own choosing within law, economics, finance and public policy for their project work. Students may choose to submit a paper with a more narrow focus than described above and achieve a 12 grade based on a thorough understanding of the subject matter in question and an overall understanding of the course material

Required reading
Private Equity as an Asset Class, Ch 1-8, SPH, Guy-Fraser-Sampson, Wiley Finance, 2010, 180p.
Contracts & Incentives  23p.
Capital Structure Stewart C. Meyers, Journal of Economic Perspectives, spring 2001, 21p.
A Survey of Corporate Governance, JG, Andrei Schleifer, Robert W. Vishny , TheJournal of Finance, Vol. 52, No.2. (Jun., 1997), pp.737-783, 46p.
Limited Partnership Agreements, BVCA ,27p.
Total 297 pages

Suggested supplementary material
The Economics of the PrivateÉquity Market, George W. Fenn and Nellie Liang, Dallas FED, 72p.
Relevant legal acts. Public acts.

Formal training at a bachelor and/or master level and practical experience in finance, business strategy, corporate governance and contract law would be helpful. Students should have en interest in financial markets, management, innovation, regulation and contracts seen mainly from a practical perspective. Basic theories and concepts from finance and law will be introduced during the course to facilitate learning for students of economics and finance as well as for law students.
The course is structured as follows:
Part 1 - introduction to Private Equity (8 weeks of 3 hours lectures)
• Faculty: Soren Hovgaard (Econ), Thomas K. Andersen (Law)
• Guest speakers from the venture capital and private equity industries, advisors and regulatory authorities. Previous speakers have included; Poul Nyrup Rasmussen, former prime minister of Denmark, Steen Thomsen, professor at CBS, as well as industry experts from Nordic Capital, Axcel, EQT, Northzone Ventures, ATKearney, SEB Enskilda, Accura Law Firm and McKinsey & Co.
Part 2 - independent written assignment (approx. 8 weeks)
  • Category
  • Hours
  • Lectures
  • 35
  • Preparation
  • 70
  • Project work
  • 170
  • Total
  • 275
Credit
10 ECTS
Type of assessment
Written assignment, 8 weeks
Econ students (10 ECTS points): Take home paper (format rules for the economic seminars apply. For detailed requirements, see the Student Handbook.)

Law students (10 ECTS points): Take home paper (max. 35,100 characters; front page, index and list of references excluded).

General rules applicable for both Econ and Law students:
Papers should be submitted in English. Students may choose to submit papers in Danish provided if so indicated upon registration for the course.
Aid
All aids allowed
Marking scale
7-point grading scale
Censorship form
No external censorship
Exam period
For the Spring semester 2015: From 26 May to 28 June 2015 The exam is an independent written project assignment during approx. 8 weeks. The teacher will inform the deadlines in the class and at Absalon. More information is available at https://intranet.ku.dk/economics_ma/examination/Pages/default.aspx
Re-exam
Same as ordinary. But if only a few students have registered for the re-exam, the exam might change to an oral exam with a synopsis to be handed in. This means that the examination date also will change.
Criteria for exam assesment

The student must in a satisfactory way demonstrate that he/she has mastered the learning outcome of the course.