In an oligopoly configuration characterized by high barriers to (re-)entry, a finite horizon, perfect information about demand and costs and the presence of three identical firms, we show that two of them (the predators) can choose to charge an initial price that is so low that the third (the...

For the 5th takeover wave, European M&As were expected to create significant takeover value: the announcement reactions were strongly positive for target shareholders (more than 35%) and the bidding shareholders also expected to gain a small though significant increase in market value of...

This paper reviews the vast academic literature on the market for corporate control.Our main focus is the cyclical wave pattern this market exhibits.From the perspective of takeover waves, we address questions such as: Why do mergers and acquisitions (M&As) occur?Does the ensuing transfer of...

Traditionally share price returns and their variance have been explained by factors linked to the operations of the company such as systematic risk, corporate size and P/E ratios or by factors related to the influence of the macro-economic environment. In these models, the institutional...

This paper investigates the effects of international diversification of banks on the value of their M&A advice. We study bidder returns to 1,253 cross-border M&A announcements. We find that acquirers engaging a more internationally diversified financial advisor generate lower excess returns....

We study wealth effects for a sample of 161 spin-offs from 15 different European countries that were announced between January 1987 and September 2000. The cumulative average abnormal return over the three-day event window is 2.35%. The mean abnormal return is 2.89% for companies that increase...

The paper investigates why the corporate landscapes of Germany and UK are so different in terms of control by analyzing ownership and control evolution in recent IPOs. We report the control evolution of a sample of size- and industry-matched German and UK companies six years subsequent to the...

The paper investigates the incentive effects of performance-vested stock options (PVSOs) in aligning management interests with shareholder wealth. Performance targets attached to option vesting would prevent executives from receiving rewards from outcomes that are unaffected by their effort.Such...

This paper examines the choice between two rights-preserving issue methods of seasoned equity offers in the UK as well as the factors determining the offer price and stock market announcement reactions.Firstly, equity issues in the UK are underwritten for different reasons than in other...

Credit contracts are non-exclusive. A string of theoretical papers shows that nonexclusivity generates important negative contractual externalities. Employing a unique dataset, we identify how the contractual externality stemming from the non-exclusivity of credit contracts affects credit...