Document Type

Article

Language

eng

Format of Original

28 p.

Publication Date

2-1996

Publisher

Elsevier

Source Publication

Journal of Financial Economics

Source ISSN

0304-405X

Abstract

In a sample of 111 MBO offers between 1984 and 1987, almost 30% attract new blockholders. These blockholders are primarily professional investors who act to facilitate a takeover by a higher bidder, thus increasing returns to both themselves and other public shareholders. In contrast, I find little evidence that pre-existing blockholders, particularly institutional holders, affect either the offer outcome or actively participate in the buyout contest once it begins. The overall pattern of results suggests that professional investors, particularly equity-holding companies, are 'control specialists' who provide valuable services as brokers in the market for corporate control.

Comments

Accepted version. Journal of Financial Economics, Vol. 40, No. 2 (February 1996): 267-294. DOI.

NOTICE: this is the author’s version of a work that was accepted for publication in Journal of Financial Economics. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Financial Economics, VOL 40, ISSUE 2, (February 1996) DOI.

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