TY - JOUR
T1 - Corporate takeovers, bargaining and managers' incentives to invest
AU - Canoy, Marcel
AU - Riyanto, Yohanes E.
AU - Van Cayseele, Patrick
N1 - Copyright:
Copyright 2018 Elsevier B.V., All rights reserved.
PY - 2000/1
Y1 - 2000/1
N2 - This paper analyzes the impact of potential takeovers on the investment decisions of managers. The takeover involves bargaining over the potential surplus between the acquiring firm, the target manager, and shareholders of the target firm. The anticipation of future takeover gains will influence the decision-makers to invest ex ante. Interestingly, both over and underinvestment might prevail, depending on the relative bargaining powers of the parties. The model encompasses specific cases documented in the empirical literature and mergers and acquisitions (M&A) practice. It is, therefore, particularly suited to focus on the desirability of anti-takeover legislation.
AB - This paper analyzes the impact of potential takeovers on the investment decisions of managers. The takeover involves bargaining over the potential surplus between the acquiring firm, the target manager, and shareholders of the target firm. The anticipation of future takeover gains will influence the decision-makers to invest ex ante. Interestingly, both over and underinvestment might prevail, depending on the relative bargaining powers of the parties. The model encompasses specific cases documented in the empirical literature and mergers and acquisitions (M&A) practice. It is, therefore, particularly suited to focus on the desirability of anti-takeover legislation.
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U2 - 10.1002/1099-1468(200001/02)21:1<1::AID-MDE961>3.0.CO;2-C
DO - 10.1002/1099-1468(200001/02)21:1<1::AID-MDE961>3.0.CO;2-C
M3 - Article
AN - SCOPUS:67650318451
SN - 1099-1468
VL - 21
SP - 1
EP - 18
JO - Managerial and Decision Economics
JF - Managerial and Decision Economics
IS - 1
ER -