Takeover Defenses of IPO Firms
Top Cited Papers
- 1 October 2002
- journal article
- Published by Wiley in The Journal of Finance
- Vol. 57 (5) , 1857-1889
- https://doi.org/10.1111/0022-1082.00482
Abstract
Many firms deploy takeover defenses when they go public. IPO managers tend to deploy defenses when their compensation is high, shareholdings are small, and oversight from nonmanagerial shareholders is weak. The presence of a defense is negatively related to subsequent acquisition likelihood, yet has no impact on takeover premiums for firms that are acquired. These results do not support arguments that takeover defenses facilitate the eventual sale of IPO firms at high takeover premiums. Rather, they suggest that managers shift the cost of takeover protection onto nonmanagerial shareholders. Thus, agency problems are important even for firms at the IPO stage.This publication has 30 references indexed in Scilit:
- Do outside directors monitor managers?: Evidence from tender offer bidsPublished by Elsevier ,2002
- Do IPO Charters Maximize Firm Value? Antitakeover Protection in IPOsJournal of Law, Economics, and Organization, 2001
- Explaining Variation in Takeover Defenses: Failure in the Corporate Law MarketSSRN Electronic Journal, 2000
- Are Shareholder Proposals All Bark and No Bite? Evidence from Shareholder Resolutions to Rescind Poison PillsJournal of Financial and Quantitative Analysis, 1998
- Underpricing, ownership and control in initial public offerings of equity securities in the UKJournal of Financial Economics, 1997
- Detecting abnormal operating performance: The empirical power and specification of test statisticsJournal of Financial Economics, 1996
- Poison or placebo? Evidence on the deterrence and wealth effects of modern antitakeover measuresJournal of Financial Economics, 1995
- Outside directors and the adoption of poison pillsJournal of Financial Economics, 1994
- The Role of Asset Structure, Ownership Structure, and Takeover Defenses in Determining Acquisition LikelihoodJournal of Financial and Quantitative Analysis, 1992
- Antitakeover charter amendments and stockholder wealthJournal of Financial Economics, 1983