scholarly journals Passive Shareholders as a Takeover Defense

2011 ◽  
Author(s):  
Andriy Bodnaruk ◽  
Pengjie Gao ◽  
Per Östberg ◽  
Hayong Yun
Keyword(s):  
Takeover Defense

Do Takeover Defense Indices Measure Takeover Deterrence?

2017 ◽  
Vol 30 (7) ◽  
pp. 2359-2412 ◽  
Author(s):  
Jonathan M. Karpoff ◽  
Robert J. Schonlau ◽  
Eric W. Wehrly
Keyword(s):  
Takeover Defense

Takeover defense, collective action and the top management team

2018 ◽  
Vol 41 (12) ◽  
pp. 1375-1394
Author(s):  
Mark A. Tribbitt ◽  
Yi Yang
Keyword(s):  
Defense Mechanisms ◽  
Top Management Team ◽  
Management Team ◽  
Competitive Dynamics ◽  
Strategic Decision ◽  
Top Management ◽  
Collective Actions ◽  
Female Ratio ◽  
Content Type ◽  
Takeover Defense

Purpose The purpose of the study is to examine the interaction between the structure of the top management team, takeover defense mechanisms and firms rate of collective actions. Design/methodology/approach The study uses elements of agency theory, prospect theory and competitive dynamics research to develop a model for examining heterogeneity in the rate of collective actions among firms in the technology sector. A sample of 299 firm-year observations arrayed into panel regression analyses is used. Findings The findings from this study show a positive relationship between the size of the top management team and the count of collective actions when takeover defense mechanisms are present. Further this study finds a negative relationship between top management team ownership and collective actions when these same takeover defense mechanisms are present. Additionally, the female ratio of the top management team is negatively related to collective actions. Research limitations/implications This study was conducted using a sample of technological firms. These relationships may not be generalizable to firms in other contexts. Further, other elements of the firm’s governance structure (i.e. board of directors or shareholders) may play an important role in the strategic decision-making process. Originality/value This study expands on existing research by linking several blocks of literature, top management team literature, competitive dynamics literature and corporate governance literature, into a model to examine firm structural characteristics on the heterogeneity in the propensity to formulate collective actions among firms.

The causes and consequences of takeover defense: Evidence from greenmail

1994 ◽  
Vol 1 (2) ◽  
pp. 201-231 ◽  
Author(s):  
Sanjai Bhagat ◽  
Richard H. Jefferis
Keyword(s):  
Takeover Defense

scholarly journals What kinds of takeover defenses are most beneficial to shareholders during and following the bidding process?

2010 ◽  
Vol 7 (4) ◽  
pp. 252-265
Author(s):  
Charmaine Glegg ◽  
Kimberly Gleason ◽  
Oneil Harris ◽  
Jeff Madura
Keyword(s):  
Bargaining Power ◽  
Multivariate Analyses ◽  
Short Term ◽  
Defense Strategies ◽  
Takeover Defenses ◽  
Long Run ◽  
Short Run ◽  
Takeover Defense ◽  
Bidding Process

We investigate whether the strength of target antitakeover defenses impacts the market’s perception of the wealth generated for both targets and bidders shareholders in acquisitions, as well as the long-run post-acquisition returns to bidders. Our results indicate that while returns to bidder shareholders are a decreasing function of takeover defense strength, target shareholders benefit from moderate takeover defense strategies, at least in the short term. However, target shareholders are adversely affected by the highest levels of takeover defenses, both in the short run and in terms of any position they hold in the acquirer after the transaction is completed, which is reflective of value destruction during the bidding process by entrenched managers. Long run returns to successful bidders are highest when a weak defense target is acquired, and a declining function of target takeover defense strength. The lowest long run returns are experienced by bidders that acquire targets with very-strong takeover defenses. These results are confirmed by multivariate analyses. Overall, our results support the Entrenchment and Myopia theories, and partially support the bargaining power hypothesis.

scholarly journals Motivations Of Public To Private Transactions: An International Empirical Investigation

2014 ◽  
Vol 31 (1) ◽  
pp. 1
Author(s):  
Aurelie Sannajust ◽  
Mohamed Arouri ◽  
Frederic Teulon
Keyword(s):  
Cash Flow ◽  
Empirical Investigation ◽  
International Perspective ◽  
Free Cash Flow ◽  
Growth Prospects ◽  
Block Holders ◽  
Tax Savings ◽  
Takeover Defense

This article contributes to the financial literature by investigating the motivations of Public to Private transactions in an international perspective (Europe, USA and Asia). We consider seven main possible motivations: tax savings, incentive realignment, control, free cash-flow, growth of prospects, takeover defense and undervaluation. Our empirical findings suggest that low growth prospects, low liquidity and high free cash-flow are the three main motivations for a Public to Private transactions. However, regions show some particularities such as importance of family block-holders in Europe and importance of the level of taxation in Asia.

Reducing Risk through Governance

2014 ◽  
Vol 3 (2) ◽  
pp. 43-53 ◽  
Author(s):  
I-Jan Yeh ◽  
Ching-Liang Chang ◽  
Joe Ueng ◽  
Vinita Ramaswamy
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Compensation Policy ◽  
Defense Strategy ◽  
Accounting Practice ◽  
Governance Practice ◽  
Corporate Governance Practice ◽  
Takeover Defense

The main purpose of this study is to investigate the determinants of formal governance policy. Many firms have a formal governance policy. Others, however, have no such a policy. This study examines what kind of firm's characteristics that encourage companies to adopt a formal governance policy. Data were collected from Corporate Library. A sample of 3,068 firms from the database of 2010 Corporate Library was analyzed. Results show that when firms have a better financial performance and better corporate governance practice, they are more likely to have a formal governance policy. Specifically, when firms have a better board rating, compensation policy, takeover defense strategy, and accounting practice, firms are more likely to have a formal governance policy.

L&T: Restructuring the Cement Business

2005 ◽  
Vol 09 (01) ◽  
pp. 83-115
Author(s):  
Ashok Banerjee ◽  
Neeraj Dwivedi
Keyword(s):  
Corporate Restructuring ◽  
Corporate History ◽  
Takeover Defense

The case describes one of the most hyped and controversial acquisition and de-merger episodes in Indian corporate history. The case involved two Indian diversified corporations: Grasim Industries Limited (Grasim) which belonged to the Aditya Birla group and a professionally managed Larsen and Toubro Limited (L&T). With an eye on exploiting possible synergies in the cement business, Grasim acquired a big chunk of shares of L&T and then went on to make an open offer for more shares. The case describes the situation and events unfolding after these developments with a view to highlight the intricacies involved in corporate restructuring through the process of demerger, such as, valuation, synergies, takeover defense and negotiations among various stakeholders.

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