Earticle

초록

영어

This paper examines the market reactions to toehold acquisitions to determine whether and under what circumstances the formation of a new large outside shareholder contributes to the shareholder value of the firm. We argue that although toehold acquisitions signal imminent challenges to the control of the management of the target firms, the challenges do not necessarily contribute to the shareholder value if the management is likely to resist ferociously. We find that while voting premium increases in response to toehold acquisitions for the entire sample, it depends on firm characteristics such as dual class stocks and the asset size whether shareholder value increases. Dual class targets exhibit a positive market reaction only if the controlling shareholders do not have sufficient corporate resources under their control, whereas single class targets show a significantly positive cumulative abnormal return regardless of the asset size. The results are consistent with the hypothesis that dual-class stocks are an outcome of the managerial incentives for entrenchment.

목차

Abstract
 I. Introduction
 II. Hypotheses
 III. Data and Methodology
  A. The Sample of Toehold Acquisitions
  B. Stock price response analysis
  C. Voting premium response analysis
 IV. Empirical Results
  A. Market reactions to toehold acquisitions
  B. Firm characteristics and the valuation effects of toehold acquisitions
  C. Regression Analyses
 References

키워드

저자

• Jeongsun Yun [ Research Fellow, Korea Securities Research Institute ] Corresponding author.
• Ki Beom Binh [ Research Fellow, Korea Securities Research Institute ]

참고문헌

발행기관

간행물

표지보기 관심저널 등록

• 간행물명

  한국재무학회 학술대회

• 간기

  부정기

• 수록기간

  2006~2024

• 십진분류

  KDC 325 DDC 330