How to build a Mergers & Acquisitions course: a complete guide for lecturers

Central question: Why should this buyer acquire this target, and where would value actually come from?

Start the course with the deal thesis rather than the spreadsheet. Students need to distinguish a strategic story from an economically testable acquisition thesis. A credible thesis identifies the buyer-specific resources, capabilities, market position or timing advantage that could make the target worth more to this owner than to the next-best owner.

What this concept covers

• Strategic motives: scale, scope, capability acquisition, market entry, vertical integration and consolidation.
• Value creation versus value transfer between buyer and seller.
• Standalone value, buyer-specific value, control premium and the danger of overpayment.
• Organic growth, alliances and acquisitions as competing strategic routes.
• Conditions that make a deal thesis falsifiable rather than rhetorical.

Learning outcomes

By the end of this concept, students should be able to:

• Explain common strategic rationales for M&A.
• Separate value creation from value transfer.
• Write a testable acquisition thesis.
• Identify the assumptions that must hold for a premium to be justified.

How to teach it

• Open with two acquisition announcements and remove the company names, then ask which rationale is testable.
• Require every team to express the deal thesis as 'We can create value because...' followed by three measurable mechanisms.
• Ask students to identify the best non-acquisition alternative before they recommend buying.

Case-style example

Helix Appliances has $2.4 billion revenue and $280 million EBITDA. It is considering EcoHome Sensors, with $420 million revenue, $36 million EBITDA and a $520 million asking price. Management forecasts $30 million of annual cross-sell revenue, $12 million of procurement savings and $45 million of one-time integration cost. Students build the acquisition thesis, identify what must be true, and decide whether strategic fit justifies the price. One team can defend speed-to-market; another can defend an internal build. Students discover that rationale is not value until the mechanisms survive arithmetic.

Where students struggle

Students often list motives without testing whether the buyer can uniquely realise them. They also confuse a strategically attractive target with an attractive transaction at any price.

Reading and a quick check

Use DePamphilis, Chapter 1, then ask students to state the value-creation mechanism in one sentence and name the assumption most likely to break it.

Teaching activity

Run a 20-minute acquisition-thesis clinic: teams must present one measurable reason to buy, one reason not to buy, and the best alternative use of capital.

Where it leads

The next step is to understand deal types, control, process and the sequence through which a strategic idea becomes a signed and closed transaction.

Central question: What kind of transaction is being proposed, and how does the process shape what the buyer can learn and control?

Students need a map of the transaction before they can model it. Public and private deals, share purchases, asset purchases, mergers, carve-outs, friendly negotiations and contested bids create different information sets, approvals, timelines and execution risks. This concept gives the class a common process vocabulary.

What this concept covers

• Acquisitions, statutory mergers, share purchases, asset purchases, tender offers and divestitures.
• Friendly versus hostile approaches and negotiated versus auction processes.
• Indicative offers, letters of intent, exclusivity, diligence, signing, conditions and closing.
• The market for corporate control and the roles of boards, advisers, shareholders, lenders and regulators.
• Execution risk between announcement, signing and completion.

Learning outcomes

By the end of this concept, students should be able to:

• Classify common transaction forms.
• Map the stages of an acquisition from strategy to closing.
• Explain how process design changes information, bargaining power and certainty.
• Identify stakeholder approvals and key execution dependencies.

How to teach it

• Give students a one-page deal announcement and ask them to infer the likely process.
• Build a lifecycle wall from target identification to integration and keep adding decisions to it throughout the course.
• Contrast a bilateral private deal with a public auction to show how access, timing and competitive pressure differ.

Case-style example

Riverton Systems is considering a $1.1 billion acquisition of a listed data-services company. The seller will allow six weeks of diligence, wants a signed deal before quarter-end and expects at least one rival bidder. Antitrust review could take 90 days after signing. Students sequence the process, decide whether to seek exclusivity and identify which decisions must be made before full diligence is complete. A buyer can rationally favour speed; another can favour information. Students discover that process is itself a source of risk and bargaining power.

Where students struggle

Students often treat signing as the end of the transaction and underestimate conditions, regulatory review, financing certainty and the gap between announcement and closing.

Reading and a quick check

Use DePamphilis, Chapters 3 and 5. Quick check: ask students to distinguish signing risk from closing risk in one minute.

Teaching activity

Use a transaction-timeline workshop. Give each team 15 deal events on cards and ask them to place, sequence and justify them.

Where it leads

With the process map in place, students can screen targets and build an acquisition thesis before committing resources to detailed analysis.

Central question: Which targets deserve scarce management and diligence attention?

M&A is partly a search problem. Corporate development teams and advisers evaluate more opportunities than they can pursue, so students need a disciplined screening process that links corporate strategy to target attributes, valuation constraints and integration feasibility.

What this concept covers

• Acquisition criteria derived from corporate strategy.
• Sector, geography, scale, capability and financial filters.
• Strategic adjacency, capability gaps and portfolio logic.
• Target scorecards and the risk of scoring false precision.
• First-pass evidence requirements before deeper diligence.

Learning outcomes

By the end of this concept, students should be able to:

• Translate corporate strategy into target-screening criteria.
• Compare targets using both strategic and financial evidence.
• Prioritise diligence questions.
• Defend why a target should progress or be rejected.

How to teach it

• Give teams the same buyer strategy and three targets, then force a ranking before they see valuations.
• Reveal valuation data later and ask which ranking changes.
• Have students write a one-paragraph acquisition thesis and a one-paragraph rejection thesis for the same target.

Case-style example

Orion Consumer wants to enter premium pet nutrition. Target A has $260 million revenue, 8% growth and 19% EBITDA margin at 9x EBITDA. Target B has $140 million revenue, 22% growth and 7% margin at 18x. Target C has $310 million revenue, 5% growth, 14% margin and the strongest retailer relationships at 10x. Students score strategic fit, economics and integration risk, then select one target for diligence. Growth-led and distribution-led recommendations can both be defensible. Students discover that screening criteria reveal what the buyer actually values.

Where students struggle

Students often reward growth or low multiples automatically. A target only makes sense relative to the buyer strategy, capabilities and realistic path to value creation.

Reading and a quick check

Use DePamphilis, Chapter 4. Quick check: ask students to name the one screening criterion that should be a deal-breaker for the buyer.

Where a simulation fits

The Investment Banking Simulation can support this stage in an extended course because teams work with transaction mandates, analysis and advisory recommendations across multiple rounds. Use it only after students can explain why a target fits the mandate rather than as a substitute for the screening framework.

Where it leads

Once a target progresses, the class needs to establish what the business earns on a standalone basis before any valuation or synergy case is credible.

Central question: What does the target actually earn before the buyer adds a deal narrative?

A merger model is only as good as the target inputs. Students should normalise earnings, examine working capital, cash conversion, customer concentration and forecast credibility before they capitalise EBITDA or layer synergies on top. This concept is where accounting becomes a deal decision.

What this concept covers

• Revenue quality, margins, cash conversion and working-capital needs.
• Quality-of-earnings adjustments and normalised EBITDA.
• Recurring versus one-off items and capitalised versus expensed costs.
• Customer, supplier and product concentration.
• Base, downside and upside forecasts tied to operational drivers.

Learning outcomes

By the end of this concept, students should be able to:

• Normalise reported earnings.
• Identify financial red flags relevant to valuation.
• Construct a defensible standalone forecast.
• Explain which adjustments require diligence evidence.

How to teach it

• Give students a reported EBITDA bridge containing deliberately ambiguous adjustments.
• Ask teams to defend which items they would accept as normalisation and which they would reject.
• Connect every forecast line to an operational driver rather than allowing percentage-growth plugs.

Case-style example

Beacon Health reports $82 million EBITDA. The number includes a $9 million one-off supplier rebate, $6 million of software-development cost capitalised rather than expensed and $5 million of temporary labour cost that management says will disappear. Its largest customer contributes 18% of revenue and renews in eight months. Students calculate at least two normalised EBITDA views, build a base forecast and state what diligence would resolve the disagreement. Students discover that reasonable buyers can value the same company differently because they disagree about earnings quality, not arithmetic.

Where students struggle

Students often accept management adjustments uncritically or strip out every bad item as one-off. The skill is to tie adjustments to evidence and recurrence.

Reading and a quick check

Use DePamphilis, Chapters 9 and 10, alongside the target financial statements. Quick check: ask which EBITDA adjustment would change the bid most if rejected.

Where a simulation fits

In the Investment Banking Simulation, teams analyse financial information and produce models and transaction materials across rounds. For this course, use the exercise to test whether students can distinguish model output from the evidence needed to support the underlying assumptions.

Where it leads

A credible standalone case lets students value the target before deciding how much, if any, of buyer-specific value should be paid to the seller.

Central question: What is the target worth on a standalone basis, and what is the maximum price this buyer should be willing to pay?

M&A valuation requires at least two views: what the company is worth without the transaction and what it may be worth to a particular buyer after credible synergies. Students should work with valuation ranges, premiums and walk-away prices rather than search for a single correct answer.

What this concept covers

• DCF, trading comparables and precedent transactions.
• Enterprise value, equity value and net debt.
• Control premiums and why precedent multiples can embed synergies.
• Standalone value versus buyer-specific value.
• Bid range, reservation price and walk-away discipline.

Learning outcomes

By the end of this concept, students should be able to:

• Build and reconcile a valuation range.
• Explain the strengths and weaknesses of each method.
• Calculate implied premiums.
• Recommend an offer range and walk-away price.

How to teach it

• Ask students to produce three valuations before revealing the seller expectation.
• Force them to write the walk-away price before entering a negotiation.
• Separate the DCF of the target from the NPV of synergies so students can see who captures the value.

Case-style example

Horizon Software generates $50 million EBITDA. Trading comparables imply 11x-13x EBITDA, precedents imply 13x-15x and the DCF gives enterprise value of 590-710 million. The seller wants $760 million. The buyer estimates synergy NPV at $120 million, but only $70 million has high-confidence owners and milestones. Students develop a bid range and maximum price, then explain how much synergy value they are willing to transfer to the seller. Students discover that the same strategic deal can become a bad acquisition through price.

Where students struggle

Students often average valuation methods mechanically or assume all synergy value belongs to the buyer. They need to defend method weights, evidence and the amount of value transferred in the premium.

Reading and a quick check

Use DePamphilis, Chapters 7-10, then Guo, Liu and Tu (2023) on peer selection. Quick check: ask whether the highest precedent multiple is evidence for the bid or evidence of prior overpayment.

Where a simulation fits

The M&A Simulation fits after this concept. Students model EBITDA, adjustments, synergies and valuation multiple before negotiating a transaction, which forces them to convert valuation analysis into a live price-and-terms decision.

Where it leads

The next concept asks whether synergies and accounting effects justify the premium and how the economics change once the buyer combines the companies.

Central question: How much combination value is real, when will it arrive, and what do accounting effects reveal or obscure?

Synergies should be taught as operating commitments, not a plug added to justify price. Students need to separate revenue from cost synergies, include implementation costs and timing, and understand that EPS accretion can coexist with value destruction. Purchase accounting also affects reported earnings after the transaction.

What this concept covers

• Revenue and cost synergies, dis-synergies and implementation costs.
• Timing, probability, ownership and double-counting of synergies.
• EPS accretion/dilution and why it is not an NPV test.
• Purchase price allocation, goodwill and identifiable intangibles.
• Sensitivity of the deal case to synergy capture.

Learning outcomes

By the end of this concept, students should be able to:

• Build a synergy bridge with timing and costs.
• Calculate simple accretion/dilution.
• Explain why accretion is not equivalent to value creation.
• Identify purchase-accounting items that affect post-deal reporting.

How to teach it

• Require each synergy line to have an owner, start date, cost and confidence level.
• Use a simple all-stock deal to calculate pro forma EPS before and after synergies.
• Ask students which synergy claims could conflict with customer retention or talent retention.

Case-style example

Apex Foods has $120 million net income and 90 million shares at $20 each. It will acquire a target earning $18 million for $360 million in an all-stock deal, issuing 18 million new shares. Before synergies, pro forma EPS falls from $1.33 to about $1.28. Management claims $10 million after-tax annual synergies, which would lift EPS to about $1.37. Students calculate dilution and accretion, then decide whether EPS supports the deal after $55 million of integration cost. Students discover that accretion can be engineered while economic value still depends on the synergy NPV.

Where students struggle

Students often treat management synergy targets as facts and EPS accretion as proof that a deal creates value. Both need independent economic tests.

Reading and a quick check

Use DePamphilis, Chapters 7, 12 and 14. Quick check: ask students to name a synergy that could increase EBITDA but reduce long-term value.

Where a simulation fits

The M&A Simulation directly tests synergy judgement because buyer and seller teams must negotiate synergies alongside EBITDA, adjustments, valuation multiple and the cash-versus-shares mix. Use the debrief to compare which synergies became price and which remained buyer upside.

Where it leads

With value and synergies quantified, students can decide how the consideration and financing mix should allocate risk between buyer, seller and capital providers.

Central question: How should the buyer pay, finance the transaction and allocate risk through structure?

Price is only one term. Cash, shares, earnouts, contingent value, debt financing, working-capital mechanisms and closing conditions change risk, control and certainty. Students should learn to choose structure from the economics and evidence rather than default to the funding source with the lowest apparent headline cost.

What this concept covers

• Cash, shares and mixed consideration.
• Acquisition financing, leverage and liquidity.
• Earnouts and contingent consideration in private deals.
• Working-capital and net-debt adjustments.
• Deal certainty, financing conditions and ownership dilution.

Learning outcomes

By the end of this concept, students should be able to:

• Compare cash and stock consideration.
• Assess financing capacity and post-deal leverage.
• Recommend mechanisms for uncertain value.
• Explain how structure transfers specific risks.

How to teach it

• Give teams the same price but three financing packages and ask which board should prefer.
• Use a seller perspective as well as a buyer perspective so certainty and participation in upside become visible.
• Force students to match each risk to a specific term rather than a generic price discount.

Case-style example

Nova Packaging plans to buy Delta Flex for $650 million. An all-cash plan uses $250 million cash and $400 million new debt, raising net leverage from 2.1x to 4.0x. A 50/50 cash-stock structure keeps leverage near 3.0x but dilutes existing shareholders by 8%. An all-stock deal dilutes them by 14% but preserves liquidity. Students recommend a structure, identify who bears operating downside and explain the conditions that would make another structure preferable. Students discover that financing and consideration are part of risk allocation, not back-office details.

Where students struggle

Students often optimise one metric, such as EPS or leverage, without considering seller preferences, financing certainty, dilution and strategic flexibility together.

Reading and a quick check

Use DePamphilis, Chapters 11-14. Quick check: ask which uncertainty should be handled with price, which with an earnout, and which with a closing condition.

Where a simulation fits

The M&A Simulation is especially useful here because the negotiated cash-versus-shares mix is one of five linked terms. The Investment Banking Simulation can extend the financing and advisory dimension when the course has enough contact time.

Where it leads

Structure cannot compensate for unknown facts indefinitely. Students now need to use due diligence to decide which risks are real, which are mitigable and which should stop the deal.

Central question: What must be verified before signing, and how should unresolved risk change the deal?

Due diligence is most useful when it changes a decision. Teach it as a hypothesis-testing process tied to the acquisition thesis, valuation and integration plan. The output is not a list of issues; it is a view on materiality and a recommendation about price, terms, protection or willingness to proceed.

What this concept covers

• Commercial, financial, tax, legal, operational, technology, cyber and HR diligence.
• Materiality and red flags tied to the deal thesis.
• Representations, warranties, indemnities, escrows and insurance at a conceptual level.
• Working-capital and net-debt mechanisms.
• Conditions precedent, disclosure and closing risk.

Learning outcomes

By the end of this concept, students should be able to:

• Prioritise diligence questions by decision relevance.
• Translate findings into valuation or term changes.
• Distinguish risks that can be priced from risks that cannot.
• Write a concise red-flag recommendation.

How to teach it

• Start with the acquisition thesis and ask what evidence would falsify it.
• Give each team five diligence findings but limit them to three management questions.
• Have teams map each issue to proceed, reprice, protect, defer or walk away.

Case-style example

Silverline Logistics is priced at $900 million. Diligence reveals that 18% of revenue comes from one customer whose contract renews in nine months, a possible environmental liability of 10-45 million and a $14 million working-capital shortfall. Management also expects a $65 million revenue contract to renew but has no signed extension. Students recommend a price adjustment, escrow, indemnity, condition, earnout or walk-away position and explain why. Students discover that the best response to risk is often targeted allocation rather than a blunt discount.

Where students struggle

Students can produce long diligence lists without changing the deal recommendation. The key is to rank findings by materiality and link them to a mechanism.

Reading and a quick check

Use DePamphilis, Chapter 5. Quick check: ask students to identify one diligence issue that cannot be solved by paying a lower price.

Where a simulation fits

The M&A Simulation works after students have practised red-flag thinking because EBITDA adjustments and synergies become negotiation issues rather than abstract model lines. The Investment Banking Simulation can support a broader transaction-process version using models, memoranda and evolving information.

Where it leads

Once the buyer knows its value range and key risks, the classroom can move into bargaining, auctions and the discipline required not to win the wrong deal.

Central question: How should the buyer compete for control without allowing competition to destroy the investment case?

M&A negotiation is more than haggling over price. Students should prepare reservation values, priorities, sequencing and concessions across multiple terms. Auctions and contested situations also create winner's-curse risk, while public takeovers add tactics and defenses that can reshape bargaining power.

What this concept covers

• Negotiation preparation, BATNA, reservation price and concession planning.
• Bilateral negotiation versus auction dynamics.
• Bid escalation, winner's curse and information asymmetry.
• Friendly and hostile tactics at a conceptual level.
• Break fees, reverse break fees, certainty and conditionality.

Learning outcomes

By the end of this concept, students should be able to:

• Prepare a multi-issue negotiation plan.
• Defend a walk-away point.
• Assess competitive bidding risk.
• Explain how tactics and certainty affect seller choice.

How to teach it

• Require every team to write its walk-away position before seeing the counterparty.
• Debrief not just the final price but the sequence of concessions.
• Compare the highest bid with the best risk-adjusted bid after the negotiation.

Case-style example

Cedar Pharma values a target at $1.05 billion standalone and estimates $230 million synergy NPV. The seller wants $1.30 billion, while a rival is rumoured to be near $1.20 billion. The seller also wants a 3% termination fee and the buyer offers a 4% reverse fee for financing or regulatory failure. Students set opening, target and walk-away bids, rank non-price concessions and decide whether to outbid the rival. Both winning and walking away can be defensible. Students discover that deal discipline is visible only when teams are willing to lose.

Where students struggle

Students often treat the goal of negotiation as reaching agreement. In M&A, no deal can be a high-quality outcome if the price or protections destroy value.

Reading and a quick check

Use DePamphilis, Chapters 3, 5 and 11. Quick check: ask students to identify the concession they would give first and the one they would protect until last.

Where a simulation fits

The M&A Simulation is the primary application. Buyer and seller teams analyse the same transaction from opposing incentives, then negotiate five linked terms. Because there is no formal score, the debrief can reward disciplined agreement or a defensible no-deal outcome rather than deal completion alone.

Where it leads

Negotiated terms still have to survive boards, shareholders, regulators and cross-border execution constraints before the transaction can close.

Central question: Can the transaction legally and institutionally close on acceptable terms?

Regulation should not be bolted onto the end of the course as a legal appendix. Competition policy, foreign-investment review, board duties, shareholder approval, securities rules and jurisdictional differences can change valuation, timing, remedies and deal certainty. Students need enough structure to recognise when specialist advice changes the economics.

What this concept covers

• Competition and antitrust review at a conceptual level.
• Board process, conflicts, shareholder approvals and governance.
• Foreign-investment and national-security review where relevant.
• Cross-border tax, currency, legal and execution issues.
• Remedies, divestitures, long-stop dates and deal certainty.

Learning outcomes

By the end of this concept, students should be able to:

• Identify major regulatory and governance dependencies.
• Assess how remedies affect synergy value.
• Incorporate timing and closing risk into the recommendation.
• Frame questions for legal and regulatory specialists without pretending to replace them.

How to teach it

• Use a merger with a high market share and ask students to redesign the deal after a remedy is imposed.
• Have finance students write a board-facing risk paragraph rather than a legal memo.
• Compare the economics before and after a required divestiture.

Case-style example

Arden Data wants to buy a US ad-technology rival for $750 million. The combined firm would hold about 38% of a defined market, the next competitor has 27%, and 40% of target revenue is earned in the EU. A proposed remedy would divest a product line with $110 million revenue but cut expected synergies by 35%. Students recommend proceed with remedies, renegotiate or abandon, and quantify the impact on the deal thesis. Students discover that regulatory risk changes value because the asset being bought may not be the asset ultimately kept.

Where students struggle

Students either ignore regulation or turn the session into legal doctrine. The teaching objective is to show how legal and governance constraints change the financial and strategic decision.

Reading and a quick check

Use DePamphilis, Chapters 2 and 18, then Bhattacharya, Illanes and Stillerman (2023/2024) for an empirical antitrust perspective. Quick check: ask which remedy would damage the original synergy case most.

Teaching activity

Run a remedy-redesign workshop. Give teams three regulator conditions and ask them to recalculate value, certainty and integration feasibility.

Where it leads

If the deal closes, value creation becomes an operating problem. Students now need to convert the acquisition thesis into an integration design.

Central question: How should the combined company integrate fast enough to capture value without destroying the capabilities it acquired?

Many M&A courses stop at closing even though most strategic claims are realised or lost after closing. Integration should therefore be a core finance-and-strategy topic: governance, decision rights, talent, systems, customers, culture and synergy milestones need to connect back to the acquisition model.

What this concept covers

• Integration thesis and degree of integration.
• Day 1, first 100 days and longer-term milestones.
• Synergy governance, owners, baselines and tracking.
• Operating-model choices, systems, culture and talent retention.
• Customer, supplier and employee disruption risk.

Learning outcomes

By the end of this concept, students should be able to:

• Design a 100-day integration plan.
• Prioritise synergies and dependencies.
• Choose an appropriate integration speed and operating model.
• Create a small set of deal-thesis KPIs.

How to teach it

• Give teams the signed deal model and ask them to convert five value drivers into operating milestones.
• Force trade-offs between fast cost capture and capability preservation.
• Use pre-mortems: ask what could make the deal look strategically correct at signing but fail by year two.

Case-style example

Meridian Industrial acquires FlowTech for access to automation capability. The deal model includes $70 million annual synergies: $35 million procurement, $20 million cross-sell and $15 million overhead, with $85 million one-time integration cost. Twenty-five key engineers hold critical product knowledge and voluntary attrition is already 12%. Students build a 100-day plan, assign synergy owners and choose what to integrate immediately versus preserve. Fast integration and selective autonomy can both be defended. Students discover that synergy timing depends on operating choices, not spreadsheet dates.

Where students struggle

Students often assume integration is a project-management exercise after the finance is finished. In reality, integration feasibility should constrain the premium before signing.

Reading and a quick check

Use DePamphilis, Chapter 6, and Chaturvedi and Weigelt (2024). Quick check: ask which synergy line is most exposed to talent loss.

Teaching activity

Run a synergy-to-action workshop: each group converts one modelled synergy into owner, baseline, milestone, implementation cost and risk indicator.

Where it leads

The final concept broadens the perspective from a single transaction to divestiture discipline, post-deal review and the capability to repeat M&A successfully.

Central question: How should a company learn from completed deals, exit assets that no longer fit and build a repeatable M&A capability?

A mature M&A course should finish beyond the individual acquisition. Companies create or destroy value through portfolios of deals, divestitures and the quality of their repeatable process. Students should review whether the original thesis materialised, distinguish bad execution from a bad thesis and recognise when selling an asset is the value-creating choice.

What this concept covers

• Post-deal review against original assumptions.
• Divestitures, carve-outs, spin-offs and asset sales.
• Portfolio fit and capital reallocation.
• Programmatic versus episodic acquisition capability.
• Governance of lessons learned, integration playbooks and decision rights.

Learning outcomes

By the end of this concept, students should be able to:

• Evaluate a completed deal against its original thesis.
• Recommend hold, fix, divest or restructure.
• Separate thesis error from execution error.
• Design a repeatable M&A scorecard and learning loop.

How to teach it

• Ask students to revisit the Session 1 acquisition thesis using post-deal evidence.
• Run a red-team review in which one group defends management and another argues the board should divest.
• End with a one-page M&A playbook covering screening, valuation discipline, diligence, integration and review.

Case-style example

Summit Holdings completed eight acquisitions in five years for $1.9 billion. Five met their synergy plans, two missed by more than 40% and one lost its top management team. A non-core unit now has $300 million revenue and $18 million EBITDA. A buyer offers $210 million; management estimates a risky turnaround NPV of $260 million. Students recommend divest or hold, then identify which acquisition-process changes the board should institutionalise. Students discover that M&A capability includes disciplined selling and learning, not just repeated buying.

Where students struggle

Students often evaluate every transaction in isolation and interpret divestiture as failure. A portfolio view shows that exiting a weak fit can be the highest-value decision.

Reading and a quick check

Use DePamphilis, Chapters 16-17, plus Jin et al. (2025) or David (2021) for broader acquisition patterns. Quick check: ask what evidence would prove a repeat acquirer is learning rather than simply becoming more active.

Teaching activity

Use a deal-review memo: teams score the original thesis, valuation, diligence, integration and realised outcomes, then recommend one process change for the next acquisition.

Where it leads

The course now closes where it began: the board must decide not only whether a deal can be completed, but whether it is the best use of capital and management attention.

10-week course structure

A 10-session course should compress adjacent analytical topics without deleting valuation, structure, negotiation, regulation or integration. The cleanest compression is to combine strategy with process, screening with standalone analysis, and integration with divestiture review.

14-week course structure

A 14-session version creates space to separate valuation methods, deepen diligence and negotiation, and give the M&A Simulation a dedicated preparation and debrief slot. The additional time should increase decision quality, not simply add more theory.

The M&A Simulation places students inside a live acquisition between Kestrel Security, the seller, and Meridian Cloud, the buyer. Teams first analyse company and financial evidence, then negotiate five linked terms: EBITDA, adjustments, synergies, valuation multiple and the cash-versus-shares mix. The buyer enters the proposed terms and the seller confirms them. A no-deal outcome is possible and can be academically defensible.

Why it fits here

Use it only after students can distinguish standalone value from buyer-specific value and have already worked with synergies and structure. The exercise then tests whether they can use those concepts against an opposing party rather than merely calculate them.

What students do

• Receive role-specific context and objectives for Kestrel Security or Meridian Cloud.
• Analyse the financial evidence and develop a position on EBITDA and adjustments.
• Estimate and challenge synergies rather than accept them as a plug.
• Form a view on valuation multiple and total transaction value.
• Negotiate the cash-versus-shares mix alongside the economic terms.
• Reach and confirm a complete set of terms, or maintain a defensible no-deal position.
• Compare final terms across negotiation groups and explain which assumptions or concessions drove the outcome.

Recommended course placement

• At the end of Session 6 or during Session 7 after valuation, synergies, structure and diligence.
• Inside a two-hour applied class if most modelling preparation is completed before the live negotiation.
• Before the main acquisition committee memo so students can convert a negotiated outcome into a written recommendation.

Knowledge students should have before the simulation

• Enterprise value, EBITDA and normalisation adjustments.
• DCF and multiples as valuation evidence.
• Revenue and cost synergies, timing and implementation risk.
• Cash versus shares and basic deal-structure trade-offs.
• The difference between a target price and a walk-away price.

Delivery format

Suggested debrief questions

• Which term changed the economics most after negotiation began?
• How much of the synergy value moved into the seller price?
• Which EBITDA adjustment had the weakest evidence?
• Did the cash-versus-shares mix solve a genuine risk-allocation issue or only help close the negotiation?
• Which concession would you reverse if you could reopen the deal?
• Was agreement better than no deal at the final terms?
• What additional diligence would you require before signing?

The Investment Banking Simulation is a longer transaction environment rather than a single M&A negotiation. It runs across four rounds and a 20-year lifecycle of two companies. Teams use financial analysis and DCF, produce models and Approval Memoranda, work with financing terms and enterprise-value bids, and respond to changing mandates and information. The live product page positions it for 16-32 hours, so it belongs in a longer or blended M&A course.

Why it fits here

Use it when you want students to see the advisory and financing infrastructure around M&A, not only the buyer-seller bargain. It is especially useful for MSc, MBA or 14-session formats where the module can allocate several blocks to valuation, financing, transaction advice and execution.

What students do

• Work in competitive teams across role-based mandates, including lenders, PE firms and sell-side advisory perspectives as responsibilities change over rounds.
• Analyse financial information and build or interpret DCF and transaction models.
• Prepare Approval Memoranda and other transaction recommendations.
• Work with debt-capital-markets and financing decisions in the earlier rounds.
• Move into acquisition, divestiture, fairness-opinion and restructuring situations as the company lifecycle develops.
• Submit models, financing terms, enterprise-value bids and final team outputs that can be used in debrief and optional assessment.

Recommended course placement

• Across Sessions 5-8 in a blended course after students know valuation and basic deal structure.
• Across a dedicated intensive block in an MSc or MBA module.
• As an extension in the 14-session version, with the M&A Simulation retained as the focused buyer-seller negotiation.

Knowledge students should have before the simulation

• Basic finance and DCF.
• Enterprise value and transaction valuation.
• Basic buy-side and sell-side incentives.
• How financing choices affect transaction feasibility.
• How analysis should be converted into an advisory or investment recommendation.

Delivery format

Suggested debrief questions

• Which model assumption changed your recommendation most?
• How did your team role affect the evidence you prioritised?
• Where did financing constraints change strategic options?
• What did the transaction process reveal that a static case would not?
• Which outputs would be useful to a corporate development team and which are mainly advisory artefacts?
• What further diligence would a board need before approving an acquisition?

Grading with the M&A Simulation

The M&A Simulation is a buyer-seller negotiation around five linked terms. There is no formal score, so assessment should focus on decision quality and evidence rather than whether a team completed a deal.

• Quality of the team's EBITDA and adjustment reasoning.
• Discipline of the valuation range and walk-away position.
• Evidence and realism behind synergy assumptions.
• How well the cash-versus-shares mix addresses economic or risk-allocation issues.
• Consistency between negotiated terms and the pre-negotiation acquisition thesis.
• Quality of the post-simulation explanation of concessions, no-deal logic or revised recommendation.
• An individual note or oral defence to establish which reasoning each student can personally defend.

Grading with the Investment Banking Simulation

The Investment Banking Simulation is a 16-32 hour, four-round transaction environment. Grade it as an extended process exercise using the team artefacts that matter to your course, then add individual evidence outside the platform.

• Quality of models and valuation reasoning across relevant rounds.
• Use of briefing material and changing information in Approval Memoranda or recommendations.
• Financing logic and the relationship between capital structure and transaction feasibility.
• Strength of enterprise-value bids or advisory recommendations where M&A work appears.
• Response to deadlines, changing roles and counterparty behaviour.
• Ability to explain what a corporate acquirer would still need to diligence before board approval.
• Individual oral defence, assumptions note or reflection linked to specific team outputs.

The platform records what each team decided, the terms they agreed and comparative outcomes across groups. That evidence supports your academic judgement; it does not replace it, and it does not establish which individual student made which argument.