Using data on auctions of companies, we estimate valuations (maximum willingness to pay) of strategic and financial bidders from their bids. We find that a typical target is valued higher by strategic bidders. However, 22.4% of targets in our sample are valued higher by financial bidders. These...

While acquisitions are a popular form of investment, the link between firms' financial constraints and acquisition policies is not well-understood. We develop a model in which financially-constrained bidders decide when to approach the target, how much to bid, and whether to bid in cash or...

Management buyouts (MBOs) are an economically and legally significant class of transaction: not only do they account for more than $10 billion in deal volume per year, on average, they also play an important role in defining the relationship between inside and outside shareholders in every...

I analyze how boards of directors with heterogeneous preferences can affect the information shared with the CEO with the help of a cheap-talk model that allows for large groups of receivers. This paper provides new insights on how heterogeneity of boards can change the way of communication...

We look for necessary properties of shareholder-value maximizing corporate boards when shareholders face a trade-off between improving information sharing between the board and management and reducing distortions in decision-making arising out of managerial agency. We draw a distinction between...

We characterize optimal corporate boards when shareholders face a trade-off between improving information sharing between the board and management and reducing distortions in decision making arising out of managerial agency. We show that allocating authority to management is suboptimal....

This study investigates a communication game between a CEO and a board of directors where the CEO's career concerns can potentially impede value-increasing informative communication. By adopting a policy of aggressive boards (excessive replacement), shareholders can facilitate communication...