Gorton, Gary (contributor); Kahl, Matthias (contributor); … - 2005
distressed firms are more likely to lose their jobs (see Gilson
(1989)). Acquiring a larger company with stock would dilute the … acquirer’s ownership of the
combined company and perhaps lead to a loss of control for incumbent management. These diffi … of the com-
bined company is simply the sum of the stand-alone values,
ji
CC + . We assume that only one
firm has …