A New Era

Nicholas Center for Applied Corporate Finance Established

Albert "Ab" Nicholas, a School of Business alumnus and long-time University of Wisconsin-Madison benefactor, has made a $6.4 million gift to benefit the Applied Corporate Finance (ACFIN) program of the School of Business.

His gift, announced in October, establishes the Nicholas Center for Applied Corporate Finance. Nicholas is chair and chief executive officer of the Milwaukee-based mutual fund firm of Nicholas Co., Inc. He earned a bachelor's degree in economics from UW-Madison in 1952 and an MBA in 1955.

Also in October, an anonymous donor added another $2 million to accelerate development of the ACFIN program.

“We are extremely grateful for Ab's generous gift to the school,” said Dean Michael M. Knetter. “Ab has been a leader in philanthropy in many areas and we are honored that he has chosen to support this program. The additional anonymous gift will ensure that we make rapid progress.”

Nicholas said he made the gift because he wanted to, “give back to a school that has done so much for me.” Nicholas said a course in Corporate Finance taught by the late Frank Graner, the legendary finance professor, was “instrumental in choosing my life's work, so it is close to my heart.” Nicholas said he also made the gift to support the school's new MBA strategy, focusing on career specializations such as Applied Corporate Finance. “I am pleased and proud to be a part of helping revitalize the graduate business program,” he said.

ACFIN is the only applied program in the country that focuses exclusively on practical training in corporate finance. It combines real-world experience with innovative teaching of financial methods and techniques. Its students get hands-on experience working on corporate finance consulting.

Established in 1999 by the former chair of the Department of Finance, Investment and Banking, Howard Thompson, ACFIN students typically analyze problem areas for participating firms in areas such as working capital management, funding sources, valuation, capital expenditure decisions and joint venture and strategic alliances. A few examples of companies that have sponsored projects are 3M (see story on p. 4), Medtronic, Qualcomm and Bank of America Securities.

Nicholas has long-standing ties to the university and the School of Business. He was named a Distinguished Business Alumnus of the School of Business in 1985 and served on its Board of Visitors from 1985 to 1987. His lead gift during Grainger Hall's construction led to a lecture hall in Grainger Hall bearing his name.

Nicholas is a former president and board member of the National W Club, sits on the board of the UW Foundation and is a past member of the UW System Board of Regents. He is a member of the Wisconsin Alumni Association and the Bascom Hill Society. In 1993, he received the Wisconsin Alumni Association's Distinguished Alumnus award. A former AllÐBig Ten basketball player, Nicholas and his wife, Nancy Johnson Nicholas - also a UW-Madison graduate - previously gave the university $10 million for construction of the Nicholas-Johnson Pavilion, a practice facility adjoining the Kohl Center.

The Nicholas Center for Applied Corporate Finance will be under the direction of James K. Seward, associate professor of Finance, Investment and Banking and Prochnow Fellow in Finance, and Cynthia Horner, who will serve as center director.

Horner said the program's wide-ranging project work prepares students to be leaders in various finance positions: “We are honored that Mr. Nicholas recognizes the value of the practical experience that ACFIN students gain during their academic training.”

For more information about the Nicholas Center for Applied Corporate Finance, visit the website at www.bus.wisc.edu/acfin or send email to ACFIN@bus.wisc.edu.

ACFIN in Action

Increasingly, ACFIN students are being asked by corporate sponsors for assistance in problem areas that include challenging global financial issues. For example, students in the program are developing and applying an advanced valuation model to assess the feasibility of an alternative energy source in emerging markets.

3M Worldwide, a U.S.-based corporation with global operations, contacted ACFIN about investigating the proper use of fuel cells as an alternative energy source. 3M has patented a proprietary technology for Proton Exchange Membrane (PEM) cells which have a number of applications across industries. ACFIN received a grant from UW-Madison's Center for International Business Education and Research (CIBER) for a project to provide insights into the future role of PEM technology within 3M's emerging market strategy.

James K. Seward, associate professor of Finance, Investment and Banking, who heads the ACFIN program, said these kinds of real-world experiences are essential to students. "The CIBER grant provided the ACFIN students with an invaluable opportunity to bridge the gap between the academic knowledge accumulated in the classroom setting and the application of that knowledge to decision-making in a real-world context. The business world is increasingly competitive and global, so the opportunity to work side-by-side with business professionals in the pursuit of profitable solutions to difficult problems is an incomparable experience."

ACFIN student Mike Jamison said the most valuable aspect of interacting with 3M has been "getting the chance to put to use all the skills that I honed throughout the year, namely a real options knowledge base, industry research and corporate communication."

AFCIN students hope to complete the project by the end of the year and travel to 3M headquarters in St. Paul, Minn., to present their final results to the company.