The University of Texas at Dallas

School of Management

Finance 6366–501 International Financial Management

Spring 2006

Professor David J. Springate

________________________________________________________________

Course Description

My aim is to work with you on both concepts that are useful in dealing with
international currency issues when operating across national boundaries and on
recent developments in the world’s capital markets. The context of the course
will be financial issues of importance to corporations. The instructional focus will
be individual development. The course aims to develop professional
effectiveness in understanding selected developments and in being able to work
with concepts useful in valuation, investment and financing.

As you will see below, the course is broken into four major areas of concern.
They are foreign exchange exposure management, foreign investment, corporate
funding for established and emerging companies, foreign investment and project
finance. These topics should be viewed as being selectively chosen and do not
comprise complete coverage of the international finance field. Some areas that
could easily be included, for example, cash management, use of particular
capital markets, or exchange rate forecasting, have been excluded on the basis
of time availability.

This course is designed for practicing business people. To this end, there will be
substantial class discussion and case analysis of topical issues. Much of the
learning will come from classmates and from individual study and preparation for
our discussions.

WebCT will be used to a limited extent in a support role in this course.

Course Structure

The course is comprised of 14 classes and associated preparation/analysis

time. It will include the following elements:

• Consideration and discussion of published cases. We will use eight cases

in class to identify issues, and respond to each other's comments.
Questions to initiate thought and preparation for class will be posted in the
WebCT "Discussion" area and be distributed weekly in class. Class
performance, in terms of frequency of contribution and depth of analysis,
will be assessed weekly (Total 1/3 of grade).
• Group presentations exploring foreign exchange exposure and capital
market issues. The three presentations will each include consideration by
group members of a selected case and, perhaps, relevant journal articles
(Total 1/3 of grade).
• The writing of individual papers. Two case analyses will be assigned. To
encourage substantive analysis some limited class time will be devoted to
this activity (Total 1/3 of grade). .
• An on-going grading system. Once I have identified you, feedback should
be available monthly.
• The ability to communicate with class-mates and team members through
WebCT, e-mail or telephone bridge. This will both aid class preparation
and enable the completion of group assignments.
• Office visits, WebCT, e-mail and telephone contact with me.
• The textbook which will serve as a learning resources and reference.
Please note that the “Associated Readings” on p.6 are only loosely tied to
topics

More Details on WebCT Use

Intended use in course:

• To post the course syllabus

• To post the course calendar
• To post each week’s discussion questions
• To post the two written assignments
• To post the three group presentation topics
• To support, in audio/visual form, any required handouts or audio lectures
• To support the communication within groups working together for class
preparation or presentations.
• To support electronic communication between class members and
instructor You will have to arrange for WebCT access as necessary. You’ll
need to have a UTD NetID and password (your UTD Unix/Email ID and
password) to access the course. If you need help, please call Vinodh.
More Details on “MeetingPlace” Conference System Use

UTD maintains a telephone conferencing system from Latitude Communications.

Class members can access a meeting by dialing a “972” area code number using
any touch tone phone and entering a meeting code. Conferencing is available for
smaller groups of students for group discussions or group assignment
preparations. If a group wants to reserve a time slot during the workweek of
Monday through Friday, please send an email one week in advance to
vinodh@utdallas.edu with course name, student names and email addresses,
choice of date, and start and end times. Once a reservation has been made, you
will receive a confirmation and participation instructions.

A class teleconference is usually recorded and can be reviewed over the phone.
To access the recording of the entire meeting, students can dial the same phone
number and select option 3 "review a meeting" and then follow the prompts to
enter the correct meeting month, date and meeting ID.

Instructor Information:

Dr. David Springate

972-883-2647
SM 1.708
spring8@utdallas.edu
http://www.utdallas.edu/~spring8

Assistant: Ms. Cindi Godwin

972-883-5941
cynthia@utdallas.edu
SM 1.519

Technical: Mr. Vinodh Sankaranarayanan

972-883-4417
vinodh@utdallas.edu

Course Materials

Required Cases and Reference Book:

You are responsible for procuring a copy of each case. There is a list below.
Cases will normally be available through the campus and off-campus book
stores.

The book chosen for reading and reference is Global Corporate Finance, 6th
Edition by Suk Kim, Seung Kim, and Kenneth Kim.
Harvard Business School Cases:

B.F. Goodrich – Rabobank I.R. Swap 9-284-080

Tiffany and Company 1993 9-295-047
MSDI – Alcala de Henares, Spain 9-289-029
Walt Disney Company’s Yen Financing 9-287-058
Gaz de France 9-288-030
Kendle International, Inc -- 1997 9-200-033
Hedging Currency Risks at AIFS 9-205-026
Foreign Exchange Hedging Strategies at General Motors 9-204-024
JC Penney (B) 9-206-118
Globalizing the Cost of Capital and Capital Budgeting at AES 9-204-109
Petrolera Zuata Petrozuata C.A. 9-299-012
Japanese Automakers Face Endaka 9-796-030

Ivey Case:
Hutchison – Whampoa Capital Structure Decision 9A99N021

Student Assessment and Evaluation

Grading Basis:

Class Discussion and Participation 33+%

Written Case Assignments (2) 33+%
Class Team Presentations (3) 33+%
100%

Informal Reports:

You can check your class participation and other grades by accessing the “My
Grade” icon on WebCT after each grade is released. This feature will not be
immediately available.

Class Identification:

Each student will be given a name card for use in class. Please use it to help me
learn your name.

Class Participation:

Class discussion and participation consists of responding in class to the on-going

discussion about the assigned cases. Starting questions will be posted in the
Discussion areas for each case. Students are expected to participate in the
discussion for each case.
Group Presentations:

There will be three class team presentations. The prepared presentations should
be in PowerPoint format and include audio to explain and expand each slide in
the presentation. Financial information exhibits can be attached in Excel or Word
or .rtf format. Contact Vinodh for more help on this topic.

Group presentation materials should be sent to the instructor in advance. The

planned presentations include:

Group Presentation #1: Hedging Currency Risks at AIFS

Group Presentation #2: Foreign Exchange Hedging Strategies at General Motors

Group Presentation #3: Petrolera Zuata Petrozuata C.A.

Individual Assignments:

Expected to be:

Gaz de France
Kendle International

Final Examination

None scheduled.

Scholastic Honesty – Cheating

I am required to remind you that plagiarism is a serious offense at this University.

Do not claim written work as your own if it is not so. The university has policies
and discipline procedures regarding scholastic dishonesty. Detailed information
is available at http://www.utdallas.edu/student/slife/dishonesty.htm
Course Date Section of Topic Case Assoc.
Week Course Readings

Introduction to
Introduction,
course.
1 1/12 Formation of None Kim 1,2,3,4
Formation of
Groups
groups.

2 1/19 FX Exposure Tiffany & Co. KKK 9

MSDI Alcala de Henares

3 1/26 Parities KKK 5
(1987, Spain)
Foreign
Exchange
Exposure Hedging Currency Risks at AIFS
Exposure
4 2/2 Management (2004, Great Britain) KKK 6
Management
(Presentation #1)

Walt Disney Company’s Yen

5 2/9 Currency Swaps KKK 7
Financing (1985, Japan)

B.F. Goodrich – Rabobank I.R. Swap

6 2/16 Interest Swaps KKK 8
(1983, Netherlands)

Views of
7 2/23 TBA KKK 1-9
Executives

Foreign Exchange Hedging

FX Management
8 3/2 Strategies at Genera Motors (2001, KKK 9
Strategies
USA) (Presentation #2)

Capital Hutchison –Wampoa: Capital

9 3/16 Structure and Capital Structure Structure Decision KKK 18
Funding (1996, Hong Kong)

Debt
10 3/23 JC Penney (B) (1985, USA) KKK 10,11
Management

Capital Globalizing the Cost of Capital and

11 3/30 Cost of Capital KKK 13
Budgeting Capital Budgeting

12 4/6 Choice of Capital Petrolera Zuata Petrozuata C.A.

Project
Structure and (1997, Venezuela) KKK 19,14
Finance
Funding Sources (Presentation #3)
13 4/13

International Japanese Automakers Face Endaka KKK

14 4/20 Complexity
Competition (1995, Japan) 15, 16, 17
The group presentations are scheduled for 2/2, 3/2 and 4/13. The individual papers will
be assigned on 2/9 and 3/23. They are due 2/23 and 4/6, respectively.