Disentangling Target Motives And Bidders Selection Of Targets

Download or read book Disentangling Target Motives and Bidders' Selection of Targets written by Jenny Zha Giedt and published by . This book was released on 2018 with total page 55 pages. Available in PDF, EPUB and Kindle. Book excerpt: Prior papers characterizing takeover targets do not address the possibility that certain attributes affect the selling firm's volition to seek its sale while opposite attributes are sought by bidders. Using a sample of potential target firms that volitionally put themselves up for sale, I find that firms that seek strategic alternatives are performing poorly and have governance incentives to maximize shareholder value. In contrast, the subset of firms that receive bids have relatively better growth and performance, and lower market risk. It appears that, given their choices, bidders do not select under-performing targets, but that potential target firms discipline themselves.