EMBA Faculty: Ivan Brick
High Finance, Brick by Brick
Professor Ivan Brick recently met a former student who said, "I just closed a multi-million dollar deal, and I used your tools to evaluate the company."
Understanding cash flow and the relationship between risk and value are key concepts, but so are the more qualitative aspects of financial decision-making. "Anyone with a computer can do analysis; the question is whether a manager grasps what's behind the numbers."
Dr. Brick, chair of the Finance and Economics departments, was largely instrumental in creating the new Masters Program in Quantitative Finance. Through his efforts, RBS has a new state-of-the-art real-time trading room to analyze financial markets. Only a handful of universities in the US possess a similar facility.
His first love is still research, but he hasn't forgotten the importance of translating academic theory into real-world practice. In the EMBA program, Prof. Brick teaches a very highly regarded elective on Advanced Financial Management.
His case-based approach incorporates a case on the biotech sector in which the company is thinking about selling its consumer products division. How should it determine the offer price? And what would be the optimal method of financing this investment from the buyer's perspective?
In addition to the pure technical valuation, his course differs from most advanced finance courses in that Prof. Brick also introduces strategic factors that influence the final decision. Factors such as the diversification of the firm's own portfolio, the agenda of the Board of Directors, cash flows, dividend polices and liquidity ratios are introduced in the analysis. He also explores if the company should divest a division to allow a greater focus on its primary comparative advantage.
Prof. Brick has also authored a case that focuses on business mergers. How does one analyze merger offers? He interfaces finance with financial accounting to discuss how accounting statements and different components of accounting entries can indeed be analyzed to forecast future cash flows.
REMBA alumnus Doug Harless comments on his experience while auditing Prof. Ivan Brick’s Advanced Finance course, Spring 2016
I would drop in to express my gratitude for the opportunity to join your Advanced Finance class.
Hitting the refresh button in your class had me well prepared to oversee preparation of the valuation models that were completed by our controller. Because we are marketing technology and not a running business, we will likely end in a risk/reward sharing arrangement involving both up-front monies and royalties going forward. My controller ran multiple cash flow scenarios to analyze the range of potential NPV's. With this in hand, we then looked at value share of buyer vs seller for a range of upfront payments vs. royalty rates. In the end we distilled it down illustrating the important levers and the negotiating range we need to be in to achieve an equitable split on potential value. The presentation to our CFO went well and later the European Investment Bankers were complimentary on the approach and logic for the potential deal structure. For me, this small success in managing corporate expectations and steering the M&A advisors stems from our controller's passion for detail and my experience in Corporate Finance / Project Evaluations. The door to that experience was opened nearly twenty years ago by the REMBA program.
I was challenged then and now by your Advanced Finance class. You deliver the material from a holistic perspective, not simply as a pure nor applied mathematical exercise. This time around I remember a statement delivered with a smile that was roughly "finance is a social science." Well said.
- Doug Harless REMBA 1997
Professors Rosa Oppenheim and Farrokh Langdana had dinner with New Jersey EMBA alum and pharmaceutical executive, Rob Strahle, in Shanghai. When asked what he was doing there in Shanghai, and what material from the EMBA program had he found most useful, his immediate response was, "It was one 3-hour session taught by Prof. Ivan Brick in his Advanced Finance elective that got me this job. I am doing valuation for my company in New Jersey -- we are in the business of buying small and very sophisticated research operations in pharma in and around Shanghai, and I need to know how much to pay for them. Simply put, Ivan Brick put food on the table for my family and me."
"He is the kind of professor who doesn't take himself too seriously, but takes what he is teaching very seriously. He caused us to respect finance not by intimidating us with its power, but by seducing us with its value."