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Article: Rent Extraction With Securities Plus Cash

TitleRent Extraction With Securities Plus Cash
Authors
Liu, TBernhardt, D
Issue Date2021
PublisherWiley-Blackwell Publishing, Inc. The Journal's web site is located at http://www.wiley.com/bw/journal.asp?ref=0022-1082
Citation
The Journal of Finance, 2021, v. 76 n. 4, p. 1869-1912 How to Cite?
DOI: http://dx.doi.org/10.1111/jofi.13018
AbstractIn our target‐initiated theory of takeovers, a target approaches potential acquirers that privately know their standalone values and merger synergies, where higher synergy acquirers tend to have larger standalone values. Despite their information disadvantage, targets can extract all surplus when synergies and standalone values are concavely related by offering payment choices that are combinations of cash and equity. Targets exploit the reluctance of high‐valuation acquirers to cede equity claims, inducing them to bid more cash. When synergies and standalone values are not concavely related, sellers can gain by combining cash with securities that are more information‐sensitive than equities.
Persistent Identifierhttp://hdl.handle.net/10722/298735
ISSN
0022-1082
2021 Impact Factor: 7.915
2020 SCImago Journal Rankings: 18.151
ISI Accession Number ID
WOS:000637086900001

 

DC FieldValueLanguage
dc.contributor.authorLiu, T-
dc.contributor.authorBernhardt, D-
dc.date.accessioned2021-04-12T03:02:40Z-
dc.date.available2021-04-12T03:02:40Z-
dc.date.issued2021-
dc.identifier.citationThe Journal of Finance, 2021, v. 76 n. 4, p. 1869-1912-
dc.identifier.issn0022-1082-
dc.identifier.urihttp://hdl.handle.net/10722/298735-
dc.description.abstractIn our target‐initiated theory of takeovers, a target approaches potential acquirers that privately know their standalone values and merger synergies, where higher synergy acquirers tend to have larger standalone values. Despite their information disadvantage, targets can extract all surplus when synergies and standalone values are concavely related by offering payment choices that are combinations of cash and equity. Targets exploit the reluctance of high‐valuation acquirers to cede equity claims, inducing them to bid more cash. When synergies and standalone values are not concavely related, sellers can gain by combining cash with securities that are more information‐sensitive than equities.-
dc.languageeng-
dc.publisherWiley-Blackwell Publishing, Inc. The Journal's web site is located at http://www.wiley.com/bw/journal.asp?ref=0022-1082-
dc.relation.ispartofThe Journal of Finance-
dc.rightsSubmitted (preprint) Version This is the pre-peer reviewed version of the following article: [FULL CITE], which has been published in final form at [Link to final article using the DOI]. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions. Accepted (peer-reviewed) Version This is the peer reviewed version of the following article: [FULL CITE], which has been published in final form at [Link to final article using the DOI]. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions.-
dc.titleRent Extraction With Securities Plus Cash-
dc.typeArticle-
dc.identifier.emailLiu, T: tjliu@hku.hk-
dc.identifier.authorityLiu, T=rp02221-
dc.description.naturelink_to_subscribed_fulltext-
dc.identifier.doi10.1111/jofi.13018-
dc.identifier.scopuseid_2-s2.0-85103537939-
dc.identifier.hkuros321982-
dc.identifier.volume76-
dc.identifier.issue4-
dc.identifier.spage1869-
dc.identifier.epage1912-
dc.identifier.isiWOS:000637086900001-
dc.publisher.placeUnited States-

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