This research examines the traditional wisdom of takeovers and regulations. Generally, takeovers have a value adding effect, but need to be regulated in order to curb excesses. Auction promotion rules are efficient in maximizing social wealth and reducing non-value maximizing takeover deals when...

Empirical evidence shows that takeovers are value-maximizing events for target firm shareholders and enhance social efficiency. Takeovers are commonly thought to play a key role in reducing managerial slack in corporate governance through the replacement of inefficient management. Additionally,...