Toeholds and Takeovers.
Toeholds have an enormous impact in 'common-value' takeover battles, such as those between two financial bidders. This contrasts with the small impact of a toehold in a 'private-value' auction. The authors' results are consistent with empirical findings that a toehold helps...
| Main Authors: | , , |
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| Format: | Journal article |
| Language: | English |
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1999
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| _version_ | 1797063074348269568 |
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| author | Bulow, J Huang, M Klemperer, P |
| author_facet | Bulow, J Huang, M Klemperer, P |
| author_sort | Bulow, J |
| collection | OXFORD |
| description | Toeholds have an enormous impact in 'common-value' takeover battles, such as those between two financial bidders. This contrasts with the small impact of a toehold in a 'private-value' auction. The authors' results are consistent with empirical findings that a toehold helps a buyer win an auction, sometimes very cheaply. A controlling minority shareholder may, therefore, be effectively immune to outside offers. A target may benefit by requiring 'best and final' sealed-bid offers or by selling a cheap toehold or options to a 'white Knight.' The authors' analysis extends to regulators selling 'stranded assets,' creditors bidding in bankruptcy auctions, and so forth. |
| first_indexed | 2024-03-06T20:54:40Z |
| format | Journal article |
| id | oxford-uuid:38c604b8-a0c4-489b-98a7-e64f38d79ebd |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-06T20:54:40Z |
| publishDate | 1999 |
| record_format | dspace |
| spelling | oxford-uuid:38c604b8-a0c4-489b-98a7-e64f38d79ebd2022-03-26T13:52:02ZToeholds and Takeovers.Journal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:38c604b8-a0c4-489b-98a7-e64f38d79ebdEnglishDepartment of Economics - ePrints1999Bulow, JHuang, MKlemperer, PToeholds have an enormous impact in 'common-value' takeover battles, such as those between two financial bidders. This contrasts with the small impact of a toehold in a 'private-value' auction. The authors' results are consistent with empirical findings that a toehold helps a buyer win an auction, sometimes very cheaply. A controlling minority shareholder may, therefore, be effectively immune to outside offers. A target may benefit by requiring 'best and final' sealed-bid offers or by selling a cheap toehold or options to a 'white Knight.' The authors' analysis extends to regulators selling 'stranded assets,' creditors bidding in bankruptcy auctions, and so forth. |
| spellingShingle | Bulow, J Huang, M Klemperer, P Toeholds and Takeovers. |
| title | Toeholds and Takeovers. |
| title_full | Toeholds and Takeovers. |
| title_fullStr | Toeholds and Takeovers. |
| title_full_unstemmed | Toeholds and Takeovers. |
| title_short | Toeholds and Takeovers. |
| title_sort | toeholds and takeovers |
| work_keys_str_mv | AT bulowj toeholdsandtakeovers AT huangm toeholdsandtakeovers AT klempererp toeholdsandtakeovers |