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Why Higher Takeover Premia Protect Minority Shareholders

Burkart, Mike - 2001

Posttakeover moral hazard by the acquirer and free-riding by the target shareholders lead the former to acquire as few shares as necessary to gain control. As moral hazard is most severe under such low ownership concentration, inefficiencies arise in successful takeovers. Moreover, share supply...

Persistent link: https://www.econbiz.de/10012788409

Why is hedge fund activism procyclical?

Burkart, Mike; Dasgupta, Amil - C.E.P.R. Discussion Papers - 2013

We provide a theoretical model to explain the procyclicality of hedge fund activism. In our model, hedge funds which … incentives for activism and engendering procyclicality. Our model thus provides a theoretical explanation that links the … procyclicality of hedge fund activism with increases in the leverage or payouts ratios of target firms. In addition, the model …

Persistent link: https://www.econbiz.de/10011084491

Security-Voting Structure and Bidder Screening

At, Christian - 2010

This paper demonstrates that non-voting shares can promote takeovers. When the bidder has private information, shareholders may refuse to tender because they suspect to sell at an ex post unfavourable price. The ensuing friction in the sale of cash flow rights can prevent an efficient change of...

Persistent link: https://www.econbiz.de/10012760393

Legal Investor Protection and Takeovers

Burkart, Mike; Gromb, Denis; Mueller, Holger M; … - C.E.P.R. Discussion Papers - 2011

We study the role of legal investor protection for the efficiency of the market for corporate control. Stronger legal investor protection limits the ease with which an acquirer, once in control, can extract private benefits at the expense of non-controlling investors. This, in turn, increases...

Persistent link: https://www.econbiz.de/10009024489

Takeovers

Burkart, Mike - 2006

This paper reviews the existing literature on takeovers. Takeovers are a means to redeploy corporate assets more efficiently and to discipline incumbent management. However, an active market for corporate control also brings about potential inefficiencies. Takeovers may be undertaken for reasons...

Persistent link: https://www.econbiz.de/10012734369

Minority Blocks and Takeover Premia

Burkart, Mike - 2006

This paper analyses takeovers of companies owned by atomistic shareholders and by one minority blockholder, all of whom can only decide to tender or retain their shares. As private benefit extraction is inefficient, the post-takeover share value increases with the bidder's shareholdings. In a...

Persistent link: https://www.econbiz.de/10012781538

Agency Conflicts, Ownership Concentration, and Legal Shareholder Protection

Burkart, Mike - 2006

This paper analyzes the interaction between legal shareholder protection, managerial incentives, monitoring, and ownership concentration. Legal protection affects the expropriation of shareholders and the blockholder's incentives to monitor. Because monitoring weakens managerial incentives, both...

Persistent link: https://www.econbiz.de/10012781539

Minority Blocks and Takeover Premia

Burkart, Mike - 2011

This paper analyses takeovers of companies owned by atomistic shareholders and by one minority blockholder, all of whom can only decide to tender or retain their shares. As private benefit extraction is ineffcient, the post-takeover share value increases with the bidder's shareholdings. In a...

Persistent link: https://www.econbiz.de/10012714698

Initial Shareholdings and Overbidding in Takeover Contests

Burkart, Mike - 1998

Within the context of takeovers, this paper shows that in private-value auctions the optimal individually rational strategy for a bidder with partial ownership of the item is to overbid, i.e. to bid more than his valuation. This strategy, however, can lead to i) an inefficient outcome, and ii)...

Persistent link: https://www.econbiz.de/10012791613

Agency Conflicts, Ownership Concentration, and Legal Shareholder Protection

Burkart, Mike; Panunzi, Fausto - C.E.P.R. Discussion Papers - 2001

This Paper analyses the interaction between legal shareholder protection, managerial incentives, and ownership concentration. In our framework, blockholder and manager are distinct parties and the presence of a blockholder can both protect and hurt minority shareholders. Legal shareholder...

Persistent link: https://www.econbiz.de/10005662105