A contribution to an optimal capital structure theory of an enterprise

The problem of optimal capital structure of an enterprise and its impact on the market value and the overall financial costs of an enterprise have been in the centre of attention of the corporate finance theory and practice already for some decades. The capital structure optimisation is relatively a complex issue. Modigliani and Miller defined the theory principles. Other model approaches (trade-off model, hierarchic order theory, information asymmetry models) are mostly aimed at the definition of an optimal ratio of debt with a fixed interest rate over equity. The application of different model approaches is very difficult in practice, but it is very important for a successful management of the optimal capital and financial structure in transitive economies. It can also be evidenced by the financial practice of companies in developed market economies, where these approaches are being used in the practical and financial decision-making process.

Keywords: optimal capital structure theory of an enterprise, MM model, trade-off model, capital structure models based on information asymmetries, application of theoretical models of optimal capital structure in practice