Corporate Business Finance - 7343 Words

Corporate Business Finance Seminar 5 Project Finance Lauren Leigh Essaram 207507339 Ruvimbo Mukorera 206525531 27 September 2010 Submitted in partial fulfilment of the duly performed requirement of International Business Finance, School of Economics and Finance, University of KwaZulu-Natal Abstract Non-recourse financing has grown in popularity, especially in developing countries. It has done so more specifically in the basic infrastructure, natural resources and also in the energy sectors. Large-scale investments are mostly financed by project finance, due to the costs and complexities that face the standard sources of finance. The main feature of Project Finance is in the accurate estimation of cashflows and a precise†¦show more content†¦There are a diverse range of definitions given for the term project finance, but in essence the underlying theme that runs through them all is that it involves the creation of a legally autonomous project financed with equity from one or more sponsoring firms and non-recourse debt for the purpose of investing in a capital asset (Esty, 2006: 213). In simpler terms, according to R. J. Herring (2006), project finance can be defined as a form of financing structure that is specialised in order to offer a few cost advantages when there i s a large amount of capital being invested. Project finance involves the use of funds that are raised for a specific self-contained venture such as construction or a developmental project (Qfinance, 2009: 1). It is a useful and innovative financing technique that has helped with the timely financing of many important and high-profile corporate projects such as EuroTunnel, EuroDisneyland, Enron’s Dabhol Power Plant, Iridium, Globalstar, Global Crossing – the Atlantic Crossing and Pacific Crossing cables, Canary Wharf and so forth (Esty, 2006: 214). This type of financing can help with the facilitation and start of projects anywhere in the world, but is especially good for projects that are undertaken in developing countries in which great difficulty arises when trying to secure financial resources for a new project (Henrique and Sabal, 2006: 5). Project finance uses a well engineered finance mix in order toShow MoreRelatedSyllabus: Corporate Finance and Business Journ al/newspaper Article1123 Words   |  5 PagesBUSI K4003 Corporate Finance Syllabus Summer 2012, (Summer Q) Instructor: Brendan Mallee bm2115@columbia.edu Class Time/Location: July 2nd – August 8th MW 6:10-9:30pm / Hamilton Hall 516 Course Description: This course examines important issues in corporate finance from the perspective of financial managers who are responsible for making significant investment and financing decisions. The course is designed to develop critical corporate finance skills including: financial statementRead MoreThe Importance of Corporate Finance in a Business Plan2232 Words   |  9 PagesThe research is done by the request of the potential investors in the 5 Aces business club on the basis of the business plan provided. Problem faced: The importance of corporate finance in a business plan. 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Around the finance corporate, thereRead MoreThe Timeliness Of Corporate Reporting : A Comparative Study Of South Asia1031 Words   |  5 Pagestimeliness of corporate reporting: A comparative study of South Asia. Advances in International Accounting, 16, pp.17-43. [2] Ajinkya, B. and Gift, M. (1985). Dispersion of Financial Analysts Earnings Forecasts and the (Option Model) Implied Standard Deviations of Stock Returns. The Journal of Finance, 40(5), p.1353. [3] Alford, A. and Berger, P. (1999). A Simultaneous Equations Analysis of Forecast Accuracy, Analyst Following, and Trading Volume. Journal of Accounting, Auditing and Finance, 14(3), ppRead MoreOptimal Capital Structure and Stock Price835 Words   |  3 Pagesmaximizes a firm’s stock price, and the target capital structure is mix of the debt, preferred stock, and common equity the firm wants to have (Eugene and Joel 2009). 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