Clark, Ephraim; Rousseau, Patrick; Gadad, Magid - In: Multinational Finance Journal 14 (2010) 3-4, pp. 291-317
This paper looks at divestitures by 144 UK firms listed on the London Stock Exchange from 1985 to 1991 and investigates whether and how accurately investors price the firm’s option to abandon assets in exchange for their exit value. Theory prices this real option as an American style put and...
