Journal article
Bid Resistance by Takeover Targets: Managerial Bargaining or Bad Faith?
Journal of financial and quantitative analysis, v 52(3), pp 837-866
01 Jun 2017
Abstract
This paper examines management's motives for rejecting takeover bids and the associated shareholder wealth effects. We develop measures of initial bid quality and find a significant negative correlation between the quality of a bid and rejection. The likelihood of higher follow-on offers decreases with bid quality and is greater when targets have classified boards and chief executive officers (CEOs) with significant personal wealth tied to the transaction. Target CEOs who fail to close high-quality offers experience a significant rate of forced turnover. Overall, the results support a price improvement motive for contested bids.
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Details
- Title
- Bid Resistance by Takeover Targets: Managerial Bargaining or Bad Faith?
- Creators
- Thomas W. Bates - WPC: FinanceDavid A. Becher - Drexel University
- Publication Details
- Journal of financial and quantitative analysis, v 52(3), pp 837-866
- Publisher
- Cambridge Univ Press
- Number of pages
- 30
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Web of Science ID
- WOS:000403647700001
- Scopus ID
- 2-s2.0-85020522488
- Other Identifier
- 991019169263504721
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- Web of Science research areas
- Business, Finance
- Economics