The effect of severance pay on management behavior during a takeover battle is generally ambiguous. Yet, the severance … still benefits from the increase in the merged firm's total value. Moreover, given that the managers are compensated … according to an identical linear incentive scheme, the optimal shareholder policy always entails a corner solution. Managers …

This paper analyzes the interaction between financial leverage and takeover activity. We develop a dynamic model of …, and takeover terms, in which the bidder with the lowest leverage wins the takeover contest. Based on the resulting … bidder is below the industry average and that acquirers should lever up after the takeover consummation. The model also …

We examine takeover auctions when an informed bidder has better informationabout the target value than a rival and …

We set up a sequential merger game to study a firm's incentives to pass up on an opportunity to merge with another firm …. We find that such incentives may exist when there are efficiency gains from a merger, firms are of different sizes, there …

We consider takeover bidding in a Cournot oligopoly when firms have private information concerning the synergy effect … of merging with a takeover target. Two auction rules are considered: standard first-price and profit-share auctions …, supplemented by entry fees. Since non-merged firms benefit from a merger if the synergies are low, bidders are subject to a …