The Development Of The Takeover Auction Process
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The Development Of The Takeover Auction Process
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Author : Tingting Liu
language : en
Publisher:
Release Date : 2018
The Development Of The Takeover Auction Process written by Tingting Liu and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018 with categories.
We study the interaction between the legal system and the takeover auction process during the 1981 to 2015 time period. We associate the strengthening of the property rights of target boards after the 1989 Time Inc. decision with fundamental changes in the takeover auction process. Following the 1989 decision, takeover auctions have moved from public and often hostile battles to a more behind the scenes, underground process where target boards control both the number of bidders and the flow of information. Target boards are more likely to initiate the auction themselves and the time between deal initiation (in private) and public deal announcement has significantly lengthened. Accounting for the increasing length of the deal initiation process, target premiums have significantly risen since 1989. Our property rights interpretation contrasts with the entrenchment story that argues that the decline in hostile takeovers has protected poorly performing management at the expense of target shareholders. Our results are consistent with the fundamental proposition of Coase (1959, 1960) that with well-defined property rights, resources flow to their highest valued use.
The Law And Economics Of Takeovers
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Author : Athanasios Kouloridas
language : en
Publisher: Bloomsbury Publishing
Release Date : 2008-05-19
The Law And Economics Of Takeovers written by Athanasios Kouloridas and has been published by Bloomsbury Publishing this book supported file pdf, txt, epub, kindle and other format this book has been release on 2008-05-19 with Law categories.
This book studies takeovers from the acquirer's perspective. More precisely the book focuses on the legal and regulatory treatment of the risks faced by the acquiring company shareholders in takeovers. The identified risks are categorised into two main groups: first, risks generated by managerial choices and second, regulatory or external risks. The analysis considers the legal context but also draws on the economic literature, seeking to map the area under consideration and to suggest measures to improve the present position from both a law and economics perspective. More specifically, the book examines various methods of protecting the acquiring shareholders against value-decreasing or self-interested acquisitions, such as the class transaction rules, fiduciary duties, the acquiring directors' responsibilities under the Takeover Code, the court scheme procedure, the role of institutional shareholders and reward strategies, and methods of making the acquiring directors more exposed to the discipline of the market. The effects of the choice of the medium of payment are also covered. In addition, it covers the Code's position with regard to auction situations and seeks to identify ways of addressing the acquiring shareholders' interests in auctions, including auctions where buyout teams or white Knights are involved. Moreover it identifies situations where deviations from horizontal equality rules, which increase takeover premia, are or should be recognised. To that effect the Code's rules on mandatory bids, the determination of the price and the form of payment offered, partial offers and squeeze outs are considered. In addition, it covers the Code's position with regards to auction situations and seeks to identify ways of addressing the acquiring shareholders' interests in auctions, including auctions where buyout teams or White Knights are involved. Moreover it identifies situations where deviations from horizontal equality rules, which increase takeover premia, are or should be recognised. To that effect the Code's rules on mandatory bids, the determination of the price and the form of payment offered, partial offers and squeeze outs are considered. The analysis covers both hostile and friendly situations. In relation to hostile takeovers, the legal and regulatory framework of toehold strategies is analysed (Code's requirements, Disclosure Rules and Companies Act disclosure requirements etc). Market Abuse issues in relation to stake building are also highlighted. In relation to friendly takeovers the operation of lock-up agreements and break fees (Code's requirements, fiduciary law, financial assistance and other contract law concerns), is also explored. Finally, the Panel's position on adverse changes, pre-conditions and conditions which the offer can be subject to and the bidder's exposure to Material Adverse Change risk are assessed. The book discusses developments in the area under consideration including the Takeover Code regime after the implementation of the Takeover Directive and the Companies Act 2006.
Takeover Laws And Financial Development
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Author : Tatiana Nenova
language : en
Publisher: World Bank Publications
Release Date : 2006
Takeover Laws And Financial Development written by Tatiana Nenova and has been published by World Bank Publications this book supported file pdf, txt, epub, kindle and other format this book has been release on 2006 with Acquisition categories.
The issue of "an appropriate" legal framework, especially in the case of the takeover market, has been poorly studied in the case of emerging markets, yet it is of immediate relevance and practical policymaker interest. The study makes a first attempt to analyze takeover regulations in a comparative context across 50 countries. It proposes a methodology to create a detailed index on the most salient features of capital market laws, and illustrates the approach on the case of takeover legislation. The methodology allows better understanding of the impact of laws on markets and development, allows a detailed quantification of a given regulation, in this case takeover market rules, and helps determine relevant policy implications. Specifically, the framework permits the exploration of the effects of individual regulations, their substitutability and interplay, as well as the overall extent of friendliness of the laws to investors, or particular groups thereof (such as minority shareholders), and the links of specialized regulation with the overall legal system. Finally, the study explores the effect of the investor-friendliness of takeover laws on stock market development.
How Has Takeover Competition Changed Over Time
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Author : Tingting Liu
language : en
Publisher:
Release Date : 2018
How Has Takeover Competition Changed Over Time written by Tingting Liu and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018 with categories.
We study a random sample of completed and withdrawn takeovers during the 1981 to 2014 time period to provide new evidence on the role of takeover impediments such as poison pills, staggered boards and state antitakeover devices. Do such impediments act in the interest of management by promoting entrenchment or do they act in shareholder interest by improving bargaining power during the takeover auction process? We first confirm the growing trend of takeover impediments over time in our sample. We then relate these trends to changes in the takeover auction process over time. Although we corroborate prior findings of a decline in hostile takeovers and publicly reported takeover auctions between the 1980s and later time periods, we find that takeover competition across the entire auction process between deal initiation and completion has not declined. In effect, takeover competition via auctions has gone underground. Moreover, takeover premiums have not declined over time. We interpret the results to be consistent with the shareholder interest/bargaining power hypothesis and inconsistent with the management interest/entrenchment hypothesis. Our analysis highlights the usefulness of research sources for SEC merger documents including microfiche, Lexis Nexis and Thomson One Financial that provide historical information on the takeover auction process prior to the EDGAR filings that started in the mid-1990s.
Putting Auction Theory To Work
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Author : Paul Milgrom
language : en
Publisher: Cambridge University Press
Release Date : 2004-01-12
Putting Auction Theory To Work written by Paul Milgrom and has been published by Cambridge University Press this book supported file pdf, txt, epub, kindle and other format this book has been release on 2004-01-12 with Business & Economics categories.
This book provides a comprehensive introduction to modern auction theory and its important new applications. It is written by a leading economic theorist whose suggestions guided the creation of the new spectrum auction designs. Aimed at graduate students and professionals in economics, the book gives the most up-to-date treatments of both traditional theories of 'optimal auctions' and newer theories of multi-unit auctions and package auctions, and shows by example how these theories are used. The analysis explores the limitations of prominent older designs, such as the Vickrey auction design, and evaluates the practical responses to those limitations. It explores the tension between the traditional theory of auctions with a fixed set of bidders, in which the seller seeks to squeeze as much revenue as possible from the fixed set, and the theory of auctions with endogenous entry, in which bidder profits must be respected to encourage participation.
Takeover Auctions With Actively Participating Targets
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Author : Yuri Khoroshilov
language : en
Publisher:
Release Date : 2010
Takeover Auctions With Actively Participating Targets written by Yuri Khoroshilov and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2010 with categories.
This paper provides an analysis of takeover auctions in which target firms actively participate by changing their reserve prices. It considers a takeover auction as an affiliated-value English auction with flexible reserve price and discusses how the degree of value affiliation affects the bidding strategies and the degree of competition in takeover auctions. It makes comparative analysis of three different designs of English auctions and shows that a takeover auction is dominated by one of the English auctions with fixed reserve price.
Sale Of Private And Public Companies By Auction
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Author : Clare Grayston
language : en
Publisher: Springer
Release Date : 1996-08-21
Sale Of Private And Public Companies By Auction written by Clare Grayston and has been published by Springer this book supported file pdf, txt, epub, kindle and other format this book has been release on 1996-08-21 with Business & Economics categories.
The use of `auction-styled' procedures in the mergers and acquisitions field is gaining increased prominence. The term `auction' is possibly misleading as, in most cases, there is no formal auction process. Instead, bidding arrangements are handled more like a formal tender. There is evidence that not only are auctions becoming a more popular method of selling a company but also that these procedures are no longer the private domain of investment banks; that, increasingly, lawyers are taking a prominent role in these matters. To test the level of awareness of auction bids, the level of sophistication of practices and procedures which have grown up around auction bids and the level of both specific and general regulatory control in this field, a questionnaire was circulated to lawyers within a number of jurisdictions covering both Europe and North America. This work is a compilation of the reports received from those lawyers together with a final report which attempts to draw those reports together.
Do Auctions Matter Assessing The Chinese Auction Promotion Institution Of Takeover Law
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Author : Charlie Weng
language : en
Publisher:
Release Date : 2017
Do Auctions Matter Assessing The Chinese Auction Promotion Institution Of Takeover Law written by Charlie Weng and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2017 with categories.
This research examines the traditional wisdom of takeovers and regulations. Generally, takeovers have a value adding effect, but need to be regulated in order to curb excesses. Auction promotion rules are efficient in maximizing social wealth and reducing non-value maximizing takeover deals when shareholders fail to coordinate in the face of a coercive offer. China has adopted such a rule. The application of the rule nevertheless is far from satisfactory. The rule is not only ineffective in terms of the application ratio, but also reinforces controlling shareholders' power, which makes minority shareholders even more vulnerable to controlling shareholders' expropriation. This research first conducts an empirical study on Chinese shareholder distribution in listed firms. Based on these up-to-date results, this article then analyzes, from an agency problem perspective, the utilities of different types of controlling shareholders in the market. This paper concludes that the current auction promotion rule, the “5% rule,” is not efficient in light of the Chinese ownership structure. An ex ante announcement institution is suggested in order to compensate for the missing functions due to the deactivation of the rule. Finally, the paper introduces an opt-in legislation mode for the sake of the minority companies with dispersed shareholder distributions.
Mergers Acquisitions And Corporate Restructurings
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Author : Patrick A. Gaughan
language : en
Publisher: John Wiley & Sons
Release Date : 2002-07-31
Mergers Acquisitions And Corporate Restructurings written by Patrick A. Gaughan and has been published by John Wiley & Sons this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002-07-31 with Business & Economics categories.
The most comprehensive and up-to-date guide to modern corporate restructuring techniques Mergers and acquisitions are two of today's most important competitive tools used by corporations in a rapidly changing global business landscape. In this new updated and revised Third Edition of his groundbreaking book-winner of the Book of the Year Award in its category from the Association of American Publishers-author, business valuations expert, and professor Patrick Gaughan illustrates how mergers, acquisitions, and other vital forms of restructuring can work for corporations. This University Edition includes review questions specifically designed for finance students and those studying for the MBA degree. Packed with helpful advice and proven strategies, this book: * Explains virtually every type of corporate restructuring, including mergers and acquisitions, divestitures, reorganizations, joint ventures, leveraged buyouts, and more * Details the latest trends and delivers a modern, international perspective on the field * Integrates the latest relevant research in the field of mergers into the book's pragmatic treatment of the subject * Offers comprehensive coverage of the latest methods and techniques for business valuations of both public and closely held companies * Looks at the key strategies and motivating factors that arise during the course of restructurings * Analyzes and incorporates necessary legal, economic, and corporate finance considerations * Offers the best offensive and defensive tactics for hostile takeovers
Characteristics Of Bidders In Takeover Auctions
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Author : Johannes Zaia
language : en
Publisher:
Release Date : 2016
Characteristics Of Bidders In Takeover Auctions written by Johannes Zaia and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2016 with categories.