Müller, Holger M.; Panunzi, Fausto - In: The Quarterly Journal of Economics 119 (2004) 4, pp. 1217-1248
This paper examines the role of leverage in tender offers for widely held firms. We show that a leveraged "bootstrap acquisition" can implement an outcome that-from an economic perspective-is quite similar to the outcome implemented by the Grossman-Hart dilution mechanism. To raise the funds for...