(chapter12-14)(公司理财-对外经济贸易大学)

CORPORATEFINANCIALCORPORATEFINANCIALMANAGEMENTMANAGEMENTPARTIVCAPITALSTRUCTUREANDDIVIDENDPOLICY(chapter12-14)Chapter12Chapter12CAPITALSTRUCTURECONCEPTSIntroductionIntroductionIntroductionIntroduction1.Concepts2.CapitalstructureTheory4zCapitalStructureVs.FinancialStructure1.1.ConceptsCapitalStructurePermanents-tdebtL-TdebtP/SC/SFinancialStructureTotalcurrentliabilitiesL-TdebtP/SC/SContinued…zCapitalStructureTerminology–OptimalcapitalstructureoMinimizesafirm’sweightedcostofcapitaloMaximizesthevalueofthefirm–TargetcapitalstructureoCapitalstructureatwhichthefirmplanstooperate–DebtcapacityoAmountofdebtinthefirm’soptimalcapitalstructureContinued…zCapitalStructureAssumptions–Firm’sinvestmentpolicyisheldconstant–Capitalstructurechangesthedistributionofthefirm’sEBITamongthefirm’sclaimantsDebtholdersPreferredstockholdersCommonstockholders–Constantinvestmentpolicyleavingthedebtcapacityofthefirmunchanged22..CapitalStructureTheoryCapitalStructureTheoryz⎯⎯/9Continuedz——–TheoreticalPerspectivesonCapitalStructureandFirmValuation1958oNetIncomeTheoryoNetOperatingIncomeTheoryoTraditionTheory100%KsKdKacostofcapitalDebtTotalAssetsVVDebtTotalAssets100%NetIncomeTheory(NI)NetIncomeTheory(NI)100KsKdKacostofcapitalDebtTotalAssetsVDebtTotalAssets100VNetOperatingIncomeTheoryNetOperatingIncomeTheory(NOI)(NOI)costofcapitalD%TA100KsKaKd0D%TAVV100TraditionTheoryTraditionTheoryContinued–ModiglianiandMiller’sAnalysis(1958)IMMwithoutaCorporateIncomeTaxoAssumptions:9Notaxes9Notransactioncosts9IndividualsandcorporationsborrowatsamerateoResults:9PropositionI:VL=VU(=EBIT/ka=EBIT/keU)9PropositionII:keL=keU+B/E(keU-kd)ContinuedoIntuition:9PropositionI:Throughhomemadeleverage,Individualscaneitherduplicateorundotheeffectsofcorporateleverage.9PropositionII:Thecostofequityriseswithleverage,becausetherisktoequityriseswiththeleverage.9Costofequity(keL)increasestoexactlyoffsetthebenefitsofmoredebtfinancing(kd),leavingthecostofcapital(ka)constantseemodel1Model1Model1CostofCapitalDebtTotalAssetskdkakeTheoverallcostofcapitalisindependentofthecapitalstructureThefirm’svalueisindependentofthecapitalstructureContinuedoMMArbitrageProof9VU=D/keU9VL=D/keL+I/kdDpaidtoL’sstockholdersarereducedbytheamountofIpaidonthedebtkeishigherforLbecauseoftheadditionalleverage-inducedriskThevaluesofUandLareidenticalduetoarbitrageContinuedIIMMwithaCorporateIncomeTaxoAssumptions:9CorporationsaretaxedattherateT,onearningsafterinterest9Notransactioncosts9IndividualsandcorporationsborrowatsamerateoResults:9PropositionI:VL=VU+BT(forafirmwithperpetualdebt)(VU=EBIT(1-T)/keUVL=EBIT(1-T)/ka)9PropositionII:keL=keU+B/E(keU-kd)(1-T)(WACC=ka=ke*E/V+kd(1-T)*B/V)ContinuedoIntuition:9PropositionI:Sincecorporationscandeductinterestpaymentsbutnotdividendpayments,corporateleveragelowerstaxpayments.9PropositionII:Thecostofequityriseswithleverage,becausetherisktoequityriseswiththeleverage.ContinuedoMMArbitrageProof9VU=D/ke9VL=D/ke+I/kdDdistributedtoU’sstockholdersarereducedbythetaxespaidonoperatingincomeandthevalueofUdropsSinceIistaxdeductible,LrealizesataxsavingsPVoftaxshield=valueofdebt(B)Χtaxrate(T)MktValueofFirmDebt$VUVLPVofTaxShieldVL=VU+ValueofVL=VU+ValueofTaxShieldTaxShieldCostofCapitalDebtTotalassetski=kd(1-T)kakeThecostofcapitaldecreaseswiththeamountofdebtFirmmaximizesitsvaluebychoosingacapitalstructurethatisalldebtModel2Model2ContinuedCase1:Case1:AA····EBIT=$4,000,000EBIT=$4,000,000··40%40%····8%8%··EBITEBIT12%12%$1,000$1,000KaKaKeKeLL10TAKaKd(1T)Ke10010Vu=2030KaKd(1T)VL100TD3020ContinuedCase2:Aisjustabouttocommenceoperationsasaninternationaltradingcompany.Thefirmexpectstoearn$1.2millionearningsbeforetaxes.Itisknownthatthecapitalizationrateforanall-equityfirminthisbusinessis10%,thatis,keU=10%.Further,Acanborrowatarateof6%.AssumethatthetaxrateiszeroandtheMMassumptionsapply.(1)AccordingtoMM,whatwillbethevalueofAifitusesnodebt?Ifituses$4milliondebt?(2)WhatarethevaluesoftheWACCandkeLatdebtlevelsof$4million?(3)Assumetheinitialfactsoftheproblem(kd=6%,EBIT=$1.2million,keU=10%),butnowassumethata40%percenttaxrateexists.FindthenewmarketvaluesforAwithzerodebtandwith$4milliondebt.AndFindWACCandkeLatdebtlevelsof$4million?ContinuedSolution:(1)VL=VU=EBIT/keU=1.2m/10%=12m(2)E=V-B=12m-4m=8mkeL=keU+B/E(keU-kd)=10%+(10%-6%)*4m/8m=12%WACC=10%(3)VU=EBIT*(1-T)/keU=1.2*(1-40%0/10%=7.2mVL=VU+BT=7.2m+4m*40%=8.8mkeL=keU+B/E*(1-40%)(keU-kd)=10%+(10%-6%)*(1-40%)*4m/4.8m=12%WACC=ke*E/V+kd(1-T)*B/V=12%*4.8/8.8+6%*(1-T)*4/8.8=8.18%ContinuedIICapitalStructurewithaCorporateIncomeTax,FinancialDistressCosts,andAgencyCostsoB&Acostsincreasewiththeamountofleverage,eventuallyoffsetthemarginalbenefitsfromthevalueofthetaxshieldoMarketvalueofleveredfirm=Marketvalueofunleveredfirm+PVoftaxshield-PVofbankruptcycosts-PVofagencycostsSeeoptimaldebtratioslideContinuedoBankruptcyCosts:9Lendersmaydemandhigherinterestrates9Lendersmaydeclinetolendatall9Customersmayshifttheirbusinesstootherfirms9Distressincursextraaccounting&legalcosts9Ifforcedtoliquidate,assetsmayhavetobesoldforlessthanmarketvalueContinuedoAgencyCosts(Stockholder-BondholderRel