MULTINATIONAL professional services network PricewaterhouseCoopers (PwC) officially launched last week its pioneering competition on mergers and acquisitions (M&A) for Filipino college and university students aimed at bridging the gap between academe and the practical application of business consolidations.
PwC Philippines Managing Partner for Deals and Corporate Jade Divinagracia said it has been observed that most of the new graduates in the country are not prepared to do their jobs well when starting with their employment.
While students believe they are prepared for the workplace after finishing their studies, she cited multiple surveys showing disparities in their ideas of readiness versus their employers vary almost up to 30 percent. She said 19 percent of employers believe job applicants do not have enough experience.
“So there is that obvious disconnect between what they learn in school and the practical application of these theories,” Divinagracia noted. “Having said that, one of the primary objectives that we have for the M&A competition is really to try to bridge the gap between academe and actual practice.”
The contest aims to bring out the entrepreneurial spirit among the students from second-year college and up so as to help drive inclusive growth in the country.
“So our purpose really in this competition is to bring the actual realities of business into schools; to help academe transform by bringing it real-life experiences to marry with the academic concepts; and, hopefully, after the students graduate, they will be better prepared in organizing the actual world of business by what they learn in school,” said Alexander Cabrera, chairman and senior partner of PwC Philippines.
The M&A Challenge consists of several aspects on finance, accounting and tax. Participating students will go through the entire M&A deal cycle from target identification, financial modeling and valuations, through deal presentation.
A screening committee, composed of judges from the company and the business community, will select the teams through elimination rounds. Each phase will require them to apply different technical and soft skills to solving problems that may occur when engaging a client during a corporate finance engagement.
In the preliminary round, they will be asked to conduct a study on one of the four preselected industries, wherein they will identify a potential acquisition target and justify their choice. Only 20 teams will make it to the second round from where they will have to perform an evaluation of their target entity.
In the third and final round, the last six groups will present their strategic advice to a hypothetical client that justifies their chosen target company and what they think are the synergistic fit between them.
“The students will be able to use what they learned in school over the three rounds of the competition,” Divinagracia said. “So it’s not like we will push the students into the deep blue sea and just take a look at whether they will sink or swim. In a manner of speaking, we will probably do that—we will push them into the water, but we will give them some life jackets to increase their chances of being able to swim safely ashore.”
This competition runs from August until late-November. Registration is now open for currently enrolled college students from business, accounting and engineering courses. Each team must have three to four members and faculty-trainers. Deadline for nomination and application is on September 15. For more visit www.pwc.com/ph/ma-challenge.
Throughout the submission of entries, selection or screening up to the finals on November 29, PwC will be holding a webinar series for the contestants and coaches, with focus on valuation techniques, public speaking and presentation skills, as well as accounting and tax considerations in business combinations.
Out of the 25 potentiality participating universities and colleges nationwide, 19 participating schools have already joined to date, including top schools in Metro Manila and eight outside of the National Capital Region.
The top four participants, who submit the best industry analysis in the first round, will be given a cash token of P5,000 each. A cash prize of P25,000 and P50,000 will be awarded to third and second placers, respectively. The champion will take home P100,00 for the team, and another P50,000 for the faculty of the school, plus guaranteed internship opportunities with PwC Philippines’s Deals and Corporate Finance Department for 2017.
“Sans these monetary rewards, we hope the students will look at this opportunity as a learning event rather than way of winning some significant sums of money,” Divinagracia said.
“The competition is not just about their competing and going for a prize. They will also be trained along the way in the process. So we expect the schools to participate by exhausting all their efforts in business, tax and accounting,” Cabrera said.