Prof. G. William Schwert

Tu 5:50-8:50

 

E-Mail: schwert@schwert.simon.rochester.edu
CS3-110L
Phone: 275-2470
Fax: 461-5475

Secretary: Kathleen Madsen, CS3-110M, 275-4269
E-Mail: madsenka@simon.rochester.edu

This course will cover the theory and evidence concerning major corporate financial policy decisions. FIN 423 discusses alternative methods of issuing and retiring securities, mergers and acquisitions, and the market for corporate control.

The required text for this course is

J. Fred Weston, Mark L. Mitchell, and Harold Mulherin, Takeovers, Restructuring, and Corporate Governance, (4th ed.), [referred to as "WMM" in the reading assignments].

In Association with Amazon.com cover

Some of the required and supplemental articles are contained in the readings book edited by Donald Chew,
The New Corporate Finance: Where Theory Meets Practice, (3rd ed.), McGraw-Hill, 2001.

cover

If you do not already own this book (which has been required for FIN 413 in recent years), you should try to purchase a copy. Articles in the Chew book are indicated by "(DC)" in the list below. Required readings are indicated by an asterisk "*". You will be provided with copies of those required readings that are not included in DC. In addition, the relevant sections from the book,

R. Brealey, S. Myers, and F. Allen, Principles of Corporate Finance, (8th ed.), McGraw-Hill, New York, 2006,

are listed as supplemental readings. cover

This book has been used in most recent offerings of FIN 402, Capital Budgeting and Corporate Objectives, which is a prerequisite for FIN 423. Finally, and perhaps most important, I would like all of the students in the class to read the Wall Street Journal or some similar publication on a regular basis since the topics covered in this course are discussed regularly in this newspaper. 

The discussion of "current events" will be a major part of some lectures.

Relation to Other Finance Courses

In addition to FIN 402, FIN 411 (Investments) is a prerequisite for this course. FIN 411 teaches students how to evaluate the response of security prices to information ("event studies"). Since much of the evidence in FIN 423 depends on understanding event study methods, it is important that you have satisfied the FIN 411 prerequisite. FIN 413 (Corporate Finance) is a corequisite for FIN 423. FIN 413 covers topics such as bankruptcy costs and agency costs that relate to capital structure and dividend policy. If you have not already taken FIN 402, 411, and 413 (or you are not simultaneously taking 413), you are responsible for making up these deficiencies in your background.

Many of you will have already taken FIN 433 (Issues in Corporate Control) with Gregg Jarrell, or plan to take it in the future. FIN 433 spends quite a bit of time talking about mergers and acquisitions (M&A). In the past I have found that about a third of the students who have taken FIN 433 felt that there was too much overlap between FIN 423 and FIN 433. On the other hand, about a third felt that the somewhat different perspective offered in FIN 423 was very valuable to them (the remaining third did not express strong feelings either way). Unfortunately, I have been unable to find any measurable variable that would help me give advice to students about whether to bypass FIN 423. If you are concerned about this question, I encourage you to look carefully at the course outline and consider taking a different course. For those of you who choose to take FIN 423 after previously taking FIN 433, I have constructed a grading option that will let you take advantage of your background (see below).

Expectations of Student Performance

My expectations are that students will come to class prepared by having read the necessary material. The lectures will not rehash the readings. Rather, we will discuss different perspectives on the arguments presented in the readings. Active, high quality class participation will enhance the grades of students who are near margins in the final grade distribution.

I will hand out notes to accompany many of the lectures. Occasionally, I will also hand out stories reproduced from the popular business press (e.g., the Wall Street Journal).  Class attendance is very important to successful completion of this course. If you know that you will be unable to attend more than one or two of the classes, you should probably not register for this course (see the description of grading policies below). If you know that you have to be late for class, or leave early, please show courtesy to me and the rest of the class by entering and leaving the room as discretely as possible. If you miss a class, or are late in arriving, it is your responsibility to obtain copies of any handouts that were distributed in class [do not rummage around on the teaching desk looking for handouts if you arrive late!] I suggest that you form study teams and help each other out -- get extra copies of handouts for missing team-mates. I will not provide a long-term inventory of class hand-outs for people who miss class, but most of the handouts will be available on the class web page (see below).

Grading

The grading for this course will be based on a flexible system. There are several options:

Option A

There will be a Midterm Exam on February 12 (worth 20% of the course grade) and a Final Exam between March 12-16 (worth 30% of the course grade). There will also be one or two individual (not group) take-home assignments due within a week or less (in aggregate worth 10% of the course grade). Usually, exam questions will be related to the lectures, and/or the required reading, and/or current events that relate to the material that is being discussed in class.

There will be two case problems that will be done in groups of between 3 and 5 people. The case problems will involve an analysis of: (1) a security offering (e.g., an IPO), and (2) a merger/acquisition (M&A) problem. Either case could involve negotiation with an opposing team. The total group score for the cases equals the average case score times the number of students in the group. On the last day of class (March 11), each group will turn in their grade-allocation sheet containing:

(a) the percentage (summing to 100%) of the total group score that each member by name is to receive towards his/her final grade, and

(b) the signature of each group member.

If one group member's signature is missing, the grade allocation sheet is valid and binding on all members. If two or more signatures are missing, the allocation sheet is invalid and the group's score will be allocated equally among the members. I will not arbitrate disputes among group members. No grade allocation sheets will be accepted after March 11. Each case will be worth 20% of the course grade.

Option B

In addition, M.B.A. students have the option of writing a paper that can count for up to 40% of their grade (you must specify the fraction when you hand in the paper). The weight given to the quizzes and the case problems will be reduced proportionately (or, if you have missed a quiz, you may substitute the paper for one missed quiz). The paper should be between 5 and 15 typed pages and it is due on Tuesday, March 11, in class. The topic of the paper can be anything related to the course. I will approve paper topics that are unconventional, but you do not need to ask permission to write a paper on a topic similar to those listed below. In general, these papers should simulate a business research report to your boss. For example, if you are analyzing a potential merger, you might pretend that you are a junior staff member of an investment banking firm (or one of the companies involved in the transaction), and I (your boss) have asked you to report your analysis and recommendations concerning the merger (for example, Is the price a 'good' one? Why? What are the purported gains from this merger? Does the stock market think it is a wise transaction for our company or the other company? Are there likely to be regulatory problems or litigation? etc.) You may ask for general guidance as you might ask your boss, but don't come and ask me what you should write because I (your boss) expect you to be able to do this analysis yourself. Examples would be:

  1. an event study on price performance of new issues in 2004, or 2005, or 2006, or 2007;

  2. an analysis of the use of "real options" methods in valuing IPOs (with an example);

  3. a case study (similar to Ruback's paper on Conoco) on a major acquisition, spin-off, or proxy fight. Students in past years have studied Chase-Lincoln, Norstar-Security, Xerox-Crum & Forster, Computer Consoles-N.B.I., and Kodak-Sterling Drug;

  4. a case study of the performance of a successful merger or tender offer from 1 to 5 years after it was completed;

  5. or any other topic that I approve.

Option C

If you took FIN 433 (and therefore did a lot of case work), you have the option of substituting your paper for the case work in the course, but you must receive prior approval from me for this option (and approval of your paper topic).

Option Ph.D.

Ph.D. students must write a paper and will not participate in the case problems.

Course Information on the Wide World Web (WWW)

Most of the materials for this course will be posted on the home page for this course [http://schwert.simon.rochester.edu/f423/f423.htm]. For example, I plan to post copies of the slides used in the classroom presentations as Adobe Acrobat files (so they can be viewed and printed from the WWW). In addition, I have collected lists of sites that students can use to collect information on security prices (if you want to do an event study), on financial news, on securities filings with the S.E.C. (if you want to study a particular IPO prospectus, for example), and so forth. I want to encourage all students to use this resource throughout the course. One possible "paper" that students might do is to create web pages that would allow future students to analyze particular types of deals that are discussed in this course (e.g., information and data sources, examples of similar transactions, etc.)  If you are interested in pursuing that option, please see me early in the quarter.

Topics and Readings

Additional journal articles, which are not required, are included for students who want more information on particular topics. These are not on reserve in the library, although copies of the Journal of Financial Economics and the Journal of Finance are available in the Management Library (and available online through these links if you are logged into the UR network).

I. Introduction to the Course

  1. *Smith, Clifford W., "Raising Capital: Theory and Evidence," (DC, 277-293).
  2. *Brealey, Myers & Allen, Ch. 14 and 15.
  3. Henderson, Brian J., Narasimhan Jegadeesh and Michael S. Weisbach, "World markets for raising new capital," Journal of Financial Economics, 82 (October 2006) 63-101.

II. Venture Capital and Initial Public Offerings of Common Stock

  1. *Gompers, Paul and Josh Lerner, "Money Chasing Deals? The Impact of Fund Inflows on Private Equity Valuations," Journal of Financial Economics, 55 (February 2000) 281-325.
  2. *Ibbotson, Roger, Jody Sindelar, and Jay Ritter, "The Market's Problem with the Pricing of Initial Public Offerings," Journal of Applied Corporate Finance, 7 (Spring 1994) 66-74.
  3. *Kim, Moonchul and Jay Ritter, "Valuing IPOs," Journal of Financial Economics, 53 (September 1999) 409-437.
  4. *Ritter, Jay and Ivo Welch, "A Review of IPO Activity, Pricing, and Allocations," Journal of Finance, 57 (August 2002) 1795-1828.
  5. Aggarwal, Rajesh K., Krigman, Laurie, and Womack, Kent L.,"Strategic IPO Underpricing, Information Momentum, and Lockup Expiration Selling," Journal of Financial Economics, 66 (October 2002) 105-137.
  6. Aggarwal, Reena, "Allocation of Initial Public Offerings and Flipping Activity," Journal of Financial Economics, 68 (April 2003) 111-135.
  7. Amihud, Yakov, Hauser, Shmuel, and Kirsh, Amir, "Allocations, Adverse Selection, and Cascades in IPOs: Evidence from the Tel Aviv Stock Exchange," Journal of Financial Economics, 68 (April 2003) 137-158.
  8. Ang, James S. and Brau, James C., "Concealing and confounding adverse signals: Insider wealth-maximizing behavior in the IPO process"Journal of Financial Economics, 67 (January 2003) 149-172.
  9. Asquith, Daniel, Jonathan D. Jones, and Robert Kieschnick, "Evidence on Price Stabilization and Underpricing in Early IPO Returns," Journal of Finance, 53 (October 1998) 1759-1773.
  10. Barry, Christopher B., Chris J. Muscarella, John W. Peavy III, and Michael R. Vetsuypens, "The Role of Venture Capital in the Creation of Public Companies: Evidence from the Going-Public Process," Journal of Financial Economics, 27 (September 1990) 447-471.
  11. Beatty, Randolph P. and Jay R. Ritter, "Investment Banking, Reputation, and the Underpricing of Initial Public Offerings," Journal of Financial Economics, 15 (1986), 213-232.
  12. Benninga, Simon, Mark Helmantel and Oded Sarig, "The Timing of Initial Public Offerings," Journal of Financial Economics, 75 (January 2005) 115-132.
  13. Black, Bernard S. and Ronald J. Gilson, "Venture Capital and the Structure of Capital Markets: Banks versus Stock Markets," Journal of Financial Economics, 47 (March 1998) 243-277.
  14. Brav, Alon and Paul A. Gompers, "Myth or Reality? The Long-run Underperformance of Initial Public Offerings: Evidence from Venture and Non-venture Capital-backed Companies," Journal of Finance, 52 (December 1997) 1791-1822.
  15. Brennan, M. J., and Julian Franks, "Underpricing, ownership and control in initial public offerings of equity securities in the U.K.," Journal of Financial Economics, 45 (September 1997) 391-413.
  16. Busaba, Walid Y., Benveniste, Lawrence M., and Guo, Re-Jin, "The Option to Withdraw IPOs during the Premarket: Empirical Analysis," Journal of Financial Economics, 60 (April 2001) 73-102.
  17. Carter, Richard B., Frederick H. Dark, and Ajai K. Singh, "Underwriter Reputation, Initial Returns, and the Long-Run Performance of IPO Stocks," Journal of Finance, 53 (February 1998) 285-311.
  18. Chemmanur, Thomas J. and Imants Paeglis, "Management Quality, Certification, and Initial Public Offerings," Journal of Financial Economics, 76 (May 2005) 331-368.
  19. Cochrane, John H., "The Risk and Return of Venture Capital," Journal of Financial Economics, 75 (January 2005) 3-52.
  20. Cook, Douglas O., Robert Kieschnick and Robert A. Van Ness, "On the marketing of IPOs," Journal of Financial Economics, 82 (October 2006) 35-61.
  21. Demers, Elizabeth and Katharina Lewellen, "The Marketing Role of IPOs: Evidence from Internet Stocks," Journal of Financial Economics 68 (June 2003) 413-437 .
  22. Dunbar, Craig G., "The Use of Warrants as Underwriter Compensation in Initial Public Offerings," Journal of Financial Economics, 38 (May 1995) 59-78.
  23. Dunbar, Craig G., "Factors Affecting Investment Bank Initial Public Offering Market Share," Journal of Financial Economics, 55 (January 2000) 3-41.
  24. Edelen, Roger M. and Gregory B. Kadlec, "Issuer Surplus and the Partial Adjustment of IPO Prices to Public Information," Journal of Financial Economics, 77 (August 2005) 347-373.
  25. Ellis, Katrina, "Who Trades IPOs? A Close Look at the First Days of Trading," Journal of Financial Economics, 79 (February 2006) 339-363.
  26. Gande, Amar, Manju Puri, and Anthony Saunders, "Bank Entry, Competition and the Market for Corporate Securities Underwriting," Journal of Financial Economics, 54 (November 1999) 165-195.
  27. Gompers, Paul A., "Optimal Investment, Monitoring, and the Staging of Venture Capital," Journal of Finance, 50 (December 1995) 1461-1489.
  28. Griffin, John M., Jeffrey H. Harris and Selim Topaloglu, "Why are IPO investors net buyers through lead underwriters?" Journal of Financial Economics, 85 (August 2007) 518-551.
  29. Hanley, Kathleen Weiss and William J. Wilhelm, "Evidence on the Strategic Allocation of Initial Public Offerings," Journal of Financial Economics, 37 (February 1995) 239-257.
  30. Hansen, Robert S., "Do Investment Banks Compete in IPOs?: The Advent of the "7% plus Contract," Journal of Financial Economics, 59 (March 2001) 313-346.
  31. Hao, Qing, "Laddering in initial public offerings," Journal of Financial Economics, 85 (July 2007) 102-122.
  32. Hellmann, Thomas, "A theory of strategic venture investing," Journal of Financial Economics, 64 (May 2002) 285-314.
  33. Ibbotson, Roger, "Price Performance of Common Stock New Issues," Journal of Financial Economics, 2 (September 1975) 235-272.
  34. Ibbotson, Roger, Jody Sindelar, and Jay Ritter, "Initial Public Offerings," (DC, 309-317)
  35. Jain, Bharat A. and Omesh Kini, "The Post-issue Operating Performance of IPO Firms," Journal of Finance, 49 (December 1994) 1699-1726.
  36. James, Christopher and Jason Karceski, "Strength of analyst coverage following IPOs," Journal of Financial Economics, 82 (October 2006) 1-34.
  37. James, Christopher and Peggy Wier, "Borrowing Relationships, Intermediation, and the Cost of Issuing Public Securities," Journal of Financial Economics, 28 (November 1990) 149-171.
  38. Jenkinson, Tim, Alan D. Morrison and William J. Wilhelm, Jr., "Why are European IPOs so rarely priced outside the indicative price range?" Journal of Financial Economics, 80 (April 2006) 185-209.
  39. Kerins, Frank, Kenji Kutsuna and Richard Smith, "Why are IPOs underpriced? Evidence from Japan's hybrid auction-method offerings," Journal of Financial Economics, 85 (September 2007) 637-666.
  40. Krigman, Laurie, Wayne H. Shaw and Kent L. Womack, "The Persistence of IPO Mispricing and the Predictive Power of Flipping," Journal of Finance, 54 (April 1998) 1015-1044.
  41. Koh, Francis and Terry Walter, "A Direct Test of Rock's Model of the Pricing of Unseasoned Issues," Journal of Financial Economics, 23 (August 1989) 251-272.
  42. Lee, Peggy M. and Sunil Wahal, "Grandstanding, Certification and the Underpricing of Venture Capital Backed IPOs," Journal of Financial Economics, 73 (August 2004) 375-407.
  43. Lerner, Joshua, "Venture Capitalists and the Decision to Go Public," Journal of Financial Economics, 35 (June 1994) 293-316.
  44. Lerner, Joshua, Shane, Hilary and Tsai, Alexander, "Do equity financing cycles matter? evidence from biotechnology alliances,"Journal of Financial Economics, 67 (March 2003) 411-446.
  45. Ljungqvist, Alexander P. and Wilhelm, William J., Jr., "Allocations: Discriminatory or Discretionary?"Journal of Financial Economics, 65 (August 2002) 167-201.
  46. Loughran, Tim and Jay R. Ritter, "The New Issues Puzzle," Journal of Finance, 50 (March 1995) 23-51.
  47. Lowry, Michelle, "Why Does IPO Volume Fluctuate So Much?" Journal of Financial Economics, 67 (January 2003) 3-40.
  48. Lowry, Michelle and Kevin J. Murphy, "Executive stock options and IPO underpricing," Journal of Financial Economics, 85 (July 2007) 39-65.
  49. Lowry, Michelle, Micah Officer, and G. William Schwert, "The Variability of IPO Initial Returns", working paper, 2007.
  50. Lowry, Michelle and G. William Schwert, "IPO Market Cycles: Bubbles or Sequential Learning?" Journal of Finance, 57 (June 2002) 1171-1200.
  51. Lowry, Michelle and G. William Schwert, "Is the IPO Pricing Process Efficient?" Journal of Financial Economics, 71 (January 2004) 3-26.
  52. Lowry, Michelle and Shu, Susan, "Litigation Risk and IPO Underpricing," Journal of Financial Economics, 65 (September 2002) 309-335.
  53. Megginson, William L. and Kathleen A. Weiss, "Venture Capitalist Certification in Initial Public Offerings," Journal of Finance, 46 (July 1991) 879-903.
  54. Mello, Antonio S. and John E. Parsons, "Going Public and the Ownership Structure of the Firm," Journal of Financial Economics, 49 (July 1998) 79-109.
  55. Mikkelson, Wayne H., Partch, M. Megan, and Shah, Kshitij, "Ownership and Operating Performance of Companies That Go Public," Journal of Financial Economics, 44 (June 1997) 281-307.
  56. Muscarella, Chris J. and Michael R. Vetsuypens, "A Simple Test of Baron's Model of IPO Underpricing," Journal of Financial Economics, 24 (September 1989) 125-135.
  57. Nimalendran, M., Jay R. Ritter and Donghang Zhang, "Do today's trades affect tomorrow's IPO allocations?" Journal of Financial Economics, 84 (April 2007) 87-109.
  58. Puri, Manju, "Commercial Banks as Underwriters: Implications for the Going Public Process," Journal of Financial Economics, 54 (November 1999) 133-163.
  59. Ritter, Jay R., "The 'Hot Issue' Market of 1980," Journal of Business, 57 (April 1984) 215-240.
  60. Ritter, Jay R., "The Long-Run Performance of Initial Public Offerings," Journal of Finance, 46 (March 1991) 3-27.
  61. Sherman, Ann E., "Global Trends in IPO Methods: Book Building Versus Auctions with Endogenous Entry," Journal of Financial Economics, 78 (December 2005) 615-649.
  62. Sherman, Ann E. and Titman, Sheridan, "Building the IPO Order Book: Underpricing and Participation Limits with Costly Information," Journal of Financial Economics, 65 (July 2002) 3-29.
  63. Stoughton, Neal M. and Josef Zechner, "IPO-mechanisms, monitoring and ownership structure," Journal of Financial Economics, 49 (July 1998) 45-77.
  64. Teoh, Siew Hong, Ivo Welch, and T.J. Wong, 'Earnings Management and the Long-Run Market Performance of Initial Public Offerings," Journal of Finance, 53 (December 1998) 1935-1974.
  65. Tinic, Seha M., "Anatomy of Initial Public Offerings of Common Stock," Journal of Finance, 43 (September 1988) 789-822.

III. Primary Distributions of Seasoned Stock, Underwriting, Rights and Private Placements

  1. *Asquith, Paul and David W. Mullins, Jr., "Equity Issues and Offering Dilution," Journal of Financial Economics, 15 (January 1986) 61-89.
  2. *Wu, YiLin, "The Choice of Equity-Selling Mechanisms," Journal of Financial Economics, 74 (October 2004) 93-119.
  3. Barclay, Michael J., Holderness, Clifford G. and Sheehan, Dennis P., "Private Placements and Managerial Entrenchment," working paper, University of Rochester, (2003).
  4. Bhagat, Sanjai, "The Evidence on Shelf Registration," Midland Corporate Finance Journal, 2 (Spring 1984) 6-12.
  5. Bohren, Oyvind, Eckbo, B. Espen, and Michalsen, Dag, "Why Underwrite Rights Offerings? Some New Evidence," Journal of Financial Economics, 46 (November 1997) 223-261.
  6. Burch, Timothy R., Vikram Nanda and Vincent Warther, "Does It Pay To Be Loyal? An Empirical Analysis of Underwriting Relationships and Fees," Journal of Financial Economics, 77 (September 2005) 673-699.
  7. Choe, Hyuk, Ronald W. Masulis, and Vikram Nanda, "Common Stock Offerings Across the Business Cycle," Journal of Empirical Finance, 1 (June 1993) 3-31.
  8. Cornett, Marcia Millon, Hamid Mehran, and Hassan Tehranian, "Are Financial Markets Overly Optimistic About the Prospects of Firms That Issue Equity? Evidence From Voluntary Versus Involuntary Equity Issuances By Banks," Journal of Finance, 53 (1998) 2139-2159.
  9. Cronqvist, Henrik, and Mattias Nilsson, "The Choice Between Rights Offerings and Private Equity Placements," Journal of Financial Economics, 78 (November 2005) 375-407.
  10. Fama, Eugene F. and Kenneth R. French, "Financing Decisions: Who Issues Stock?" Journal of Financial Economics, 76 (June 2005) 549-582.
  11. Hansen, R. S. and J. M. Pinkerton, "Direct Equity Financing: A Resolution of a Paradox," Journal of Finance, 37 (June 1982) 651-665.
  12. Krigman, Laurie, Wayne H. Shaw and Kent L. Womack, "Why Do Firms Switch Underwriters?" Journal of Financial Economics, 60 (May 2001) 245-284.
  13. Logue, Dennis E. , and Tinic, Seha M., "Optimal choice of contracting methods: negotiated versus competitive underwritings revisited," Journal of Financial Economics, 51 (March 1999) 451-471.
  14. Loughran, Tim and Jay R. Ritter, "The Operating Performance of Firms Conducting Seasoned Equity Offerings," Journal of Finance, 52 (December 1997) 1823-1850.
  15. Myers, Stewart and N. Majluf, "Corporate Financing and Investment Decisions When Firms Have Information That Investors Do Not Have," Journal of Financial Economics, 13 (June 1984) 187-221.
  16. Narayanan, Rajesh P., Kasturi P. Rangan and Nanda K. Rangan, "The Role of Syndicate Structure in Bank Underwriting," Journal of Financial Economics, 72 (June 2004) 555-580.
  17. Pagano, Marco, Fabio Panetta, and Luigi Zingales, "Why Do Companies Go Public? An Empirical Analysis," Journal of Finance, 53 (February 1998) 27-64.
  18. Parsons, John E. and Artur Raviv, "Underpricing of Seasoned New Issues," Journal of Financial Economics, 14 (September 1985) 187-221.
  19. Rangan, Srinivasan, "Earnings Management and the Performance of Seasoned Equity Offerings," Journal of Financial Economics, 50 (October 1998) 101-122.
  20. Scholes, Myron S. and Mark A. Wolfson, "Decentralized Investment Banking: The Case of Discount Dividend-Reinvestment and Stock-Purchase Plans," Journal of Financial Economics, 24 (September 1989) 7-35.
  21. Siegel, Jordan, "Can Foreign Firms Bond Themselves Effectively by Renting U.S. Securities Laws?" Journal of Financial Economics, 75 (February 2005) 319-359.
  22. Smith, Clifford W., "Alternative Methods for Raising Capital: Rights versus Underwritten Offerings," Journal of Financial Economics, 5 (December 1977) 273-307.
  23. Spiess, D. Katherine and John Affleck-Graves, "Underperformance in Long-run Stock Returns Following Seasoned Equity Offerings," Journal of Financial Economics, 38 (July 1995) 243-267.
  24. Teoh, Siew Hong , Ivo Welch, and T. J. Wong, "Earnings Management and the Underperformance of Seasoned Equity Offerings," Journal of Financial Economics, 50 (October 1998) 63-99.
  25. Wruck, Karen H., "Equity Ownership Concentration and Firm Value: Evidence from Private Equity Financings," Journal of Financial Economics, 23 (June 1989) 3-28.

IV. Corporate Bond Financing

  1. *Brealey, Myers & Allen, Ch. 25.
  2. Anderson, Ronald C., Mansi, Sattar A., and Reeb, David M., "Founding family ownership and the agency cost of debt," Journal of Financial Economics, 68 (May 2003) 263-285.
  3. Blume, Marshall E., Donald B. Keim and Sandeep A. Patel, "Returns and Volatility of Low-Grade Bonds, 1977-1989," Journal of Finance, 46 (March 1991) 49-74.
  4. Cornell, Bradford and Kevin Green, "The Investment Performance of Low-grade Bond Funds," Journal of Finance, 46 (March 1991) 29-48.
  5. Datta, Sudip, Mai Iskandar-Datta, and Ajay Patel, "Bank monitoring and the pricing of corporate public debt," Journal of Financial Economics, 51 (March 1999) 435-449.
  6. Datta, Sudip, Mai Iskandar-Datta, and Ajay Patel, "Some Evidence on the Uniqueness of Initial Public Debt Offerings," Journal of Finance, 55 (April 2000) 715-743.
  7. Eckbo, B. Espen, "Valuation Effects of Corporate Debt Offerings," Journal of Financial Economics, 15 (January 1986) 119-151.
  8. Fridson, Martin S., "The State of the High Yield Bond Market: Overshooting or Return to Normalcy?" Journal of Applied Corporate Finance, 7 (Spring 1994) 85-97.
  9. Helwege, Jean, "How Long Do Junk Bonds Spend in Default?" Journal of Finance, 54 (February 1999) 341-357.
  10. Krishnaswami, Sudha, Spindt, Paul A., and Subramaniam, Venkat, "Information asymmetry, monitoring, and the placement structure of corporate debt," Journal of Financial Economics, 51 (March 1999) 407-434.
  11. Linn, Scott C. and J. Michael Pinegar, "The Effect of Issuing Preferred Stock on Common and Preferred Stockholder Wealth," Journal of Financial Economics, 22 (October 1988) 155-184.
    Livingston, Miles and Glenn Williams, "Drexel Burnham Lambert's bankruptcy and the subsequent decline in underwriter fees," Journal of Financial Economics, 84 (May 2007) 472-501.
  12. Spiess, D. Katherine and John Affleck-Graves, "The Long-Run Performance of Stock Returns Following Debt Offerings," Journal of Financial Economics, 54 (October 1999) 45-73.
  13. Vu, Joseph, "An Empirical Investigation of Calls of Non-convertible Bonds," Journal of Financial Economics, 16 (June 1986) 235-265.

V. Intra-Firm Exchange Offers and Recapitalizations

  1. *WMM, Ch. 13.
  2. *Masulis, Ronald W., "The Effects of Capital Structure Change on Security Prices: A Study of Exchange Offers," Journal of Financial Economics, 8 (June 1980) 139-177.
  3. Chatterjee, Sris, Upinder S. Dhillon, and Gabriel G. Ramirez, "Coercive Tender and Exchange Offers in Distressed High-yield Debt Restructurings: An Empirical Analysis," Journal of Financial Economics, 38 (July 1995) 333-360.
  4. Israel, Ronen, Aharon R. Ofer, and Daniel R. Siegel, "The Information Content of Equity-for-Debt Swaps: An Investigation of Analyst Forecasts of Firm Cash Flows," Journal of Financial Economics 25 (December 1989) 349-370.
  5. McConnell, John J. and Gary G. Schlarbaum, "Evidence on the Impact of Exchange Offers on Security Prices: The Case of Income Bonds," Journal of Business, 54 (1981) 65-85.
  6. Shah, Kshitij, "The Nature of Information Conveyed by Pure Capital Structure Changes," Journal of Financial Economics, 36 (August 1994) 89-126.

VI. Convertible Debt

  1. *Brealey, Myers & Allen, Ch. 25.
  2. *Mayers, David, "Convertible Bonds: Matching Financial and Real Options," (DC, 334-347).
  3. Asquith, Paul and David W. Mullins, Jr., "Convertible Debt: Corporate Call Policy and Voluntary Conversion," Journal of Finance, 46 (September 1991) 1273-1289.
  4. Byrd, Anthony and William T. Moore, "On the Information Content of Calls of Convertible Securities," Journal of Business, 69 (January 1996) 89-101.
  5. Campbell, C. J., Louis Ederington, and P. Vankudre, "Tax Shields, Sample Selection Bias, and the Information Content of Convertible Bond Calls," Journal of Finance, 46 (September 1991) 1291-1324.
  6. Dunn, Kenneth B. and Kenneth M. Eades, "Voluntary Conversion of Convertible Securities and the Optimal Call Strategy," Journal of Financial Economics, 23 (August 1989) 273-301.
  7. Hillion, Pierre and Theo Vermaelen, "Death Spiral Convertibles," Journal of Financial Economics, 71 (February 2004) 381-415.
  8. Mikkelson, Wayne H., "Convertible Calls and Security Returns," Journal of Financial Economics, 9 (September 1981) 237-264.
  9. Ofer, A., and A. Natarajan, "Convertible Call Policies: An Empirical Analysis of Information Signaling Hypothesis," Journal of Financial Economics, 19 (September 1987) 91-108.
  10. Singh, Ajay K., Arnold R. Cowan, and Nandkumar Nayar, "Underwritten Calls of Convertible Bonds," Journal of Financial Economics, 29 (March 1991) 173-196.

VII. Repurchase Tender Offers

  1. *WMM, Ch. 18.
  2. *Dann, Larry Y., "Common Stock Repurchases: An Analysis of Returns to Bondholders and Stockholders," Journal of Financial Economics, 9 (June 1981) 113-138.
  3. *McNally, William, "Who Wins in Large Stock Buybacks - Those Who Sell Or Those Who Hold?" (DC, 224-234).
  4. *Louis, Henock and Hal White, "Do managers intentionally use repurchase tender offers to signal private information? Evidence from firm financial reporting behavior," Journal of Financial Economics, 85 (July 2007) 205-233.
  5. Brockman, Paul and Chung, Dennis Y., "Managerial Timing and Corporate Liquidity: Evidence from Actual Share Repurchases," Journal of Financial Economics, 61 (September 2001) 417-448.
  6. Comment, Robert and Gregg A. Jarrell, "The Relative Signaling Power of Dutch-Auction and Fixed Price Self-Tender Offers and Open-Market Share Repurchases," Journal of Finance, 46 (September 1991) 1243-1271.
  7. Guay, Wayne and Harford, Jarrad, "The Cash-flow Permanence and Information Content of Dividend Increases versus Repurchases," Journal of Financial Economics, 57 (September 2000) 385-415.
  8. Hodrick, Laurie Simon, "Does stock price elasticity affect corporate financial decisions?" Journal of Financial Economics, 52 (May 1999) 225-256.
  9. Ikenberry, David, Josef Lakonishok, and Theo Vermaelen, "Market Underreaction to Open Market Share Repurchases," Journal of Financial Economics, 39 (October 1995) 181-208.
  10. Jagannathan, Murali, Stephens, Clifford P., and Weisbach, Michael S., "Financial Flexibility and the Choice between Dividends and Stock Repurchases," Journal of Financial Economics, 57 (September 2000) 355-384.
  11. Kahle, Kathleen M., "When a Buyback Isn't a Buyback: Open Market Repurchases and Employee Options," Journal of Financial Economics, 63 (February 2002) 235-261.
  12. Lie, Erik and John J. McConnell, "Earnings Signals in Fixed-Price and Dutch Auction Self-tender Offers," Journal of Financial Economics, 49 (August 1998) 161-186.
  13. Massa, Massimo, Zahid Rehman and Theo Vermaelen, "Mimicking repurchases," Journal of Financial Economics, 84 (June 2007) 624-666.
  14. Masulis, Ronald W., "Stock Repurchase by Tender Offer: An Analysis of the Causes of Common Stock Price Changes," Journal of Finance, 35 (May 1980) 305-319.
  15. Nohel, Tom and Vefa Tarhan, "Share repurchases and firm performance: new evidence on the agency costs of free cash flow," Journal of Financial Economics, 49 (August 1998) 187-222.
  16. Peyer, Urs C. and Theo Vermaelen, "The Many Facets of Privately Negotiated Stock Repurchases" Journal of Financial Economics, 75 (February 2005) 361-395.
  17. Vermaelen, T., "Common Stock Repurchases and Market Signaling," Journal of Financial Economics, 9 (June 1981) 139-183.

VIII. Interfirm Tender Offers, Mergers and Corporate Control

  1. *WMM, Ch. 1, 4, 6, and 8.
  2. *Brealey, Myers & Allen, Ch. 32 and 34.
  3. *Jensen, Michael C., "The Modern Industrial Revolution, Exit, and the Failure of Internal Control Systems," (DC, 509-528).
  4. *Ruback, Richard S., "The Conoco Takeover and Stockholder Returns," Sloan Management Review, 23 (Winter 1982) 13-32.
  5. *Schwert, G. William, "Markup Pricing in Mergers and Acquisitions," Journal of Financial Economics, 41 (June 1996) 153-192.
  6. Asquith, Paul and Kim, E. Han, "The Impact of Merger Bids on the Participating Firm's Security Holders," Journal of Finance, 37 (December 1982) 1209-1228.
  7. Baker, Malcolm and Savaoglu, Serkan, "Limited Arbitrage in Mergers and Acquisitions," Journal of Financial Economics, 64 (April 2002) 91-115.
  8. Bates, Thomas W., Michael L. Lemmon and James S. Linck, "Shareholder wealth effects and bid negotiation in freeze-out deals: Are minority shareholders left out in the cold?" Journal of Financial Economics, 81 (September 2006) 681-708.
  9. Bhagat, Sanjai, James Brickley, and U. Loewenstein, "The Pricing Effects of Interfirm Cash Tender Offers," Journal of Finance, 42 (September 1987) 965-986.
  10. Bhagat, Sanjai, Ming Dong, David Hirshleifer, and Robert Noah, "Do Tender Offers Create Value? New Methods and Evidence," Journal of Financial Economics, 76 (April 2005) 3-60.
  11. Bharadwaj, Anu, and Shivdasani, Anil, "Valuation effects of bank financing in acquisitions," Journal of Financial Economics, 67 (January 2003) 113-148.
  12. Bradley, Michael, A. Desai, and E. Han Kim, "The Rationale Behind Interfirm Tender Offers: Information or Synergy?," Journal of Financial Economics, 11 (April 1983) 183-206.
  13. Bradley, Michael, A. Desai, and E. Han Kim, "Synergistic Gains from Corporate Acquisitions and Their Division Between the Stockholders of Target and Acquiring Firms," Journal of Financial Economics, 21 (May 1988) 3-40.
  14. Brown, David T. and Michael D. Ryngaert, "The Mode of Acquisition in Takeovers: Taxes and Asymmetric Information," Journal of Finance, 46 (June 1991) 653-669.
  15. Burch, Timothy R., "Locking Out Rival Bidders: The Use of Lockup Options in Corporate Mergers," Journal of Financial Economics, 60 (April 2001) 103-141.
  16. Chang, Saeyoung, "Takeovers of Privately Held Targets, Methods of Payment, and Bidder Returns," Journal of Finance, 53 (April 1998) 773-784.
  17. Chen, Xia, Jarrad Harford and Kai Li, "Monitoring: Which institutions matter?" Journal of Financial Economics, 86 (November 2007) 279-305.
  18. Crabbe, Leland, "Event Risk: An Analysis of Losses to Bondholders and "Super Poison Put" Bond Covenants," Journal of Finance, 46 (June 1991) 689-706.
  19. DeAngelo, Harry and DeAngelo, Linda, "Ancient redwoods and the politics of finance: the hostile takeover of the Pacific Lumber Company," Journal of Financial Economics, 47 (January 1998) 3-53.
  20. Denis, David J. and Jan M. Serrano, "Active Investors and Management Turnover Following Unsuccessful Control Contests," Journal of Financial Economics, 40 (February 1996) 239-266.
  21. Dodd, Peter, "Merger Proposals, Management Discretion, and Stockholder Wealth," Journal of Financial Economics, 8 (June 1980) 105-137.
  22. Doidge, Craig, G. Andrew Karolyi and Rene M. Stulz, "Why do countries matter so much for corporate governance?" Journal of Financial Economics, 86 (October 2007) 1-39.
  23. Fallick, Bruce C. and Kevin A. Hassett, "Unionization and Acquisitions," Journal of Business, 69 (January 1996) 51-73.
  24. Franks, Julian, Robert Harris, and Sheridan Titman, "The Postmerger Share-Price Performance of Acquiring Firms," Journal of Financial Economics, 29 (March 1991) 81-96.
  25. Garvey, Gerald T. and Gordon Hanka, "Capital structure and corporate control: The effect of antitakeover statutes on firm leverage," Journal of Finance, 54 (April 1999) 519-546.
  26. Gaspar, José-Miguel, Massimo Massa and Pedro Matos, "Shareholder Investment Horizons and the Market for Corporate Control," Journal of Financial Economics, 76 (April 2005) 135-165.
  27. Goldman, Eitan and Jun Qian, "Optimal Toeholds in Takeover Contests," Journal of Financial Economics, 77 (August 2005) 321-346.
  28. Grinstein, Yaniv and Paul Hribar, "CEO Compensation and Incentives: Evidence from M&A Bonuses" Journal of Financial Economics, 73 (July 2004) 119-143.
  29. Harford, Jarrad, "Corporate Cash Reserves and Acquisitions," Journal of Finance, 54 (December 1999) 1969-1997.
  30. Harford, Jarrad, "What Drives Merger Waves?" Journal of Financial Economics, 77 (September 2005) 529-560.
  31. Hayn, Carla, "Tax Attributes as Determinants of Shareholder Gains in Corporate Acquisitions," Journal of Financial Economics, 23 (June 1989) 121-153.
  32. Holderness, Clifford G. and Dennis P. Sheehan, "Raiders or Saviors?: The Evidence on Six Controversial Investors," Journal of Financial Economics, 14 (December 1985) 555-579.
  33. Houston, Joel F., James, Christopher M., and Ryngaert, Michael D., "Where Do Merger Gains Come From? Bank Mergers from the Perspective of Insiders and Outsiders," Journal of Financial Economics, 60 (May 2001) 285-331.
  34. Hsieh, Jim and Ralph A. Walkling, "Determinants and Implications of Arbitrage Holdings in Acquisitions," Journal of Financial Economics, 77 (September 2005) 605-648.
  35. Jarrell, Gregg A., James A. Brickley, and Jeffry M. Netter, "The Market for Corporate Control: The Empirical Evidence Since 1980," Journal of Economic Perspectives, 2 (1988) 49-68.
  36. Jensen, Michael C., "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, 76 (May 1986) 323-329.
  37. Jensen, Michael C. and Richard S. Ruback, "The Market for Corporate Control: The Scientific Evidence," Journal of Financial Economics, 11 (April 1983) 5-50.
  38. Jensen, Michael C. and Jerold W. Warner, "The Distribution of Power Among Corporate Managers, Shareholders, and Directors," Journal of Financial Economics, 20 (January 1988) 3-24.
  39. Lambrecht, Bart M., "The Timing and Terms of Mergers Motivated by Economies of Scale," Journal of Financial Economics, 72 (April 2004) 41-62.
  40. Lang, Larry H. P., René M. Stulz and Ralph A. Walkling, "Managerial Performance, Tobin's q, and the Gains from Successful Tender Offers," Journal of Financial Economics, 24 (September 1989) 137-154.
  41. Lang, Larry H. P., René M. Stulz, and Ralph A. Walkling, "A Test of the Free Cash Flow Hypothesis: The Case of Bidder Returns," Journal of Financial Economics, 29 (October 1991) 315-335.
  42. La Porta, Rafael, Florencio Lopez-de-Silanes, and Andrei Shleifer, "Corporate Ownership Around the World," Journal of Finance, 54 (April 1999) 471-517.
  43. Lys, Thomas and Linda Vincent, "An Analysis of Value Destructionin AT&T's Acquisition of NCR," Journal of Financial Economics, 39 (October 1995) 353-378.
  44. Maquieira, Carlos P., William L. Megginson, and Lance Nail, "Wealth creation versus wealth redistributions in pure stock-for-stock mergers," Journal of Financial Economics, 47 (April 1998) 3-33.
  45. McLaughlin, Robyn M., "Investment-Banking Contracts in Tender Offers," Journal of Financial Economics, 28 (November 1990) 209-232.
  46. Mikkelson, Wayne H. and Richard S. Ruback, "An Empirical Analysis of the Interfirm Equity Investment Process," Journal of Financial Economics, 14 (December 1985) 523-553.
  47. Moeller, Sara B., Frederik P. Schlingemann and René M. Stulz, "Firm Size and the Gains from Acquisitions" Journal of Financial Economics, 73 (August 2004) 201-228.
  48. Moeller, Thomas, "Let's Make a Deal! How Shareholder Control Impacts Merger Payoffs," Journal of Financial Economics, 76 (April 2005) 167-190.
  49. Morellec, Erwan and Alexei Zhdanov, "The Dynamics of Mergers and Acquisitions," Journal of Financial Economics, 77 (September 2005) 649-672.
  50. Officer, Micah S., " Termination fees in mergers and acquisitions," Journal of Financial Economics, 69 (2003) 431-467.
  51. Officer, Micah S., "Collars and Renegotiation in Mergers and Acquisitions," Journal of Finance, 59 (December 2004) 2719-2743.
  52. Officer, Micah S., "The price of corporate liquidity: Acquisition discounts for unlisted targets," Journal of Financial Economics, 83 (March 2007) 571-598.
  53. Rhodes-Kropf, Matthew, David T. Robinson, and S. Viswanathan, "Valuation Waves and Merger Activity: The Empirical Evidence," Journal of Financial Economics, 77 (September 2005) 561-603.
  54. Rossi, Stefano and Paolo F. Volpin, "Cross-country Determinants of Mergers and Acquisitions," Journal of Financial Economics, 74 (November 2004) 277-304.
  55. Ruback, Richard S., "The Cities Service Takeover: A Case Study," Journal of Finance, 38 (May 1983) 319-330.
  56. Safieddine, Assem and Sheridan Titman, "Leverage and Corporate Performance: Evidence from Unsuccessful Takeovers," Journal of Finance, 54 (April 1999) 547-580.
  57. Schwert, G. William, "Hostility in Takeovers: In the Eyes of the Beholder?" Journal of Finance, 55 (December 2000) 2599-2640.

IX. Going Private/Leveraged Buyouts

  1. *WMM, Ch. 16.
  2. *Baker, George P. and Karen H. Wruck, "Lessons from a Middle Market LBO: The Case of the O. M. Scott," (DC, 567-579).
  3. *Muscarella, Chris J. and Michael R. Vetsuypens, "Efficiency and Organizational Structure: A Study of Reverse LBOs," Journal of Finance, 45 (December 1990) 1389-1413.
  4. Asquith, Paul and Thierry W. Wizman, "Event Risk, Covenants, and Bondholder Returns in Leveraged Buyouts," Journal of Financial Economics, 27 (September 1990) 195-213.
  5. Cotter, James F. and Peck, Sarah W., "The Structure of Debt and Active Equity Investors: The Case of the Buyout Specialist," Journal of Financial Economics, 59 (January 2001) 101-147.
  6. DeAngelo, Harry, Linda DeAngelo, and Edward M. Rice, "Going Private: Minority Freezeouts and Stockholder Wealth," Journal of Law and Economics, 27 (October 1984) 367-401.
  7. DeAngelo, Harry, Linda DeAngelo and Stuart C. Gilson, "The Collapse of First Executive Corporation: Junk Bonds, Adverse Publicity, and the "Run on the Bank" Phenomenon," Journal of Financial Economics, 36 (December 1994) 287-336.
  8. Denis, David J. And Diane K. Denis, "Causes of Financial Distress Following Leveraged Recapitalizations," Journal of Financial Economics, 27 (February 1995) 129-157.
  9. Healy, Paul M. and Krishna G. Palepu, "The Challenges of Investor Communication: The Case of CUC International, Inc.," Journal of Financial Economics, 38 (June 1995) 111-140.
  10. Jensen, Michael C., "Eclipse of the Public Corporation," Harvard Business Review, (September-October 1989) 61-74.
  11. Kaplan, Steven N., "The Effects of Management Buyouts on Operating Performance and Value," Journal of Financial Economics, 24 (October 1989) 217-254.
  12. Kaplan, Steven N., "The Staying Power of Leveraged Buyouts," Journal of Financial Economics, 29 (October 1991) 287-313.
  13. Kaplan, Steven N. and Richard S. Ruback, "The Valuation of Cash Flow Forecasts: An Empirical Analysis," Journal of Finance, 50 (September 1995) 1059-1093 .
  14. Lehn, Kenneth, Jeffry Netter and Annette B. Poulsen, "Consolidating Corporate Control: Dual-Class Recapitalizations versus Leveraged Buyouts," Journal of Financial Economics, 27 (September 1990) 557-580.
  15. Lichtenberg, Frank R. and Donald Siegel, "The Effects of Leveraged Buyouts on Productivity and Related Aspects of Firm Behavior," Journal of Financial Economics, 27 (September 1990) 165-194.
  16. Marais, Laurentius, Katherine Schipper, and Abbie Smith, "Wealth Effects of Going Private for Senior Securities," Journal of Financial Economics, 23 (June 1989) 155-191.

X. Defensive Tactics

  1. *WMM, Ch. 19.
  2. *Comment, Robert and G. William Schwert, "Poison or Placebo? Evidence on the Deterrence and Wealth Effects of Modern Antitakeover Measures," Journal of Financial Economics, 39 (September 1995) 3-43.
  3. Bebchuk, Lucian A., and Alma Cohen, "The Costs of Entrenched Boards," Journal of Financial Economics, 78 (November 2005) 409-433.
  4. Bhagat, Sanjai and R. H. Jefferis, "Voting Power in the Proxy Process: The Case of Antitakeover Charter Amendments," Journal of Financial Economics, 30 (November 1991) 193-225.
  5. Bradley, Michael and Lee M. Wakeman, "The Wealth Effects of Targeted Share Repurchases," Journal of Financial Economics, 11 (April 1983) 301-328.
  6. Brickley, James A., Jeffrey L. Coles, and Rory L. Terry, "Outside Directors and the Adoption of Poison Pills," Journal of Financial Economics, 35 (June 1994) 371-390.
  7. Brickley, James A., Ronald C. Lease, and Clifford W. Smith, "Corporate Voting: Evidence from Charter Amendment Proposals," Journal of Corporate Finance, 1 (March 1994) 5-31.
  8. Cook, Douglas O. and John C. Easterwood, "Poison Put Bonds: An Analysis of Their Economic Role," Journal of Finance, 49 (December 1994) 1905-1920.
  9. Cotter, James F. And Marc Zenner, "How Managerial Wealth Affects the Tender Offer Process," Journal of Financial Economics, 35 (February 1994) 63-97.
  10. Dann, Larry Y. and Harry DeAngelo, "Standstill Agreements, Privately Negotiated Stock Repurchases, and the Market for Corporate Control," Journal of Financial Economics, 11 (April 1983) 275-300.
  11. Dann, Larry and Harry DeAngelo, "Corporate Financial Policy and Corporate Control: A Study of Defensive Adjustments in Asset and Ownership Structure," Journal of Financial Economics, 20 (January 1988) 87-127.
  12. DeAngelo, Harry and Edward M. Rice, "Antitakeover Charter Amendments and Stockholder Wealth," Journal of Financial Economics, 11 (April 1983) 329-359.
  13. Denis, David J., "Defensive Changes in Corporate Payout Policy: Share Repurchases and Special Dividends," Journal of Finance, 45 (December 1990) 1433-1456.
  14. Gordon, Lilli A. and John Pound, "ESOPs and Corporate Control," Journal of Financial Economics, 27 (September 1990) 525-555.
  15. Jarrell, Gregg A. and Annette B. Poulsen, "Shark Repellents and Stock Prices: The Effects of Antitakeover Amendments Since 1980," Journal of Financial Economics, 19 (September 1987) 127-168.
  16. Kamma, S., J. Weintrop, and Peggy Weir, "Investors' Perceptions of the Delaware Supreme Court Decision in UNOCAL v. Mesa," Journal of Financial Economics, 20 (January 1988) 419-430.
  17. Karpoff, Jonathan M. and Paul H. Malatesta, "The Wealth Effects of Second-generation State Takeover Legislation," Journal of Financial Economics, 25 (December 1989) 291-322.
  18. Linn, Scott and John J. McConnell, "An Empirical Investigation of the Impact of 'Antitakeover' Amendments on Common Stock Prices," Journal of Financial Economics, 11 (April 1983) 361-399.
  19. Malatesta, Paul H. and Ralph A. Walkling, "Poison Pill Securities: Stockholder Wealth, Profitability, and Ownership Structure," Journal of Financial Economics, 20 (January 1988) 347-376.
  20. Rauh, Joshua D., "Own company stock in defined contribution pension plans: A takeover defense?" Journal of Financial Economics, 81 (August 2006) 379-410.
  21. Ryngaert, Michael, "The Effect of Poison Pill Securities on Shareholder Wealth," Journal of Financial Economics, 20 (January 1988) 377-417.

XI. Antitrust Law and Regulation of the Market for Corporate Control

  1. *WMM, Ch. 2.
  2. Daines, Robert, "Does Delaware Law Improve Firm Value?" Journal of Financial Economics, 62 (December 2001) 525-558.
  3. Eckbo, B. Espen, "Horizontal Mergers, Collusion, and Stockholder Wealth," Journal of Financial Economics, 11 (April 1983) 241-273.
  4. Eckbo, B. Espen and Herwig Langohr, "Information Disclosure, Method of Payment, and Takeover Premiums: Public and Private Tender Offers in France," Journal of Financial Economics, 24 (October 1989) 363-403.
  5. Fee, C. Edward and Shawn Thomas, "Sources of Gains in Horizontal Mergers: Evidence from Customer, Supplier, and Rival Firms," Journal of Financial Economics, 74 (December 2004) 423-460.
  6. Franks, Julian R. and Robert S. Harris, "Shareholder Wealth Effects of Corporate Takeovers: The U.K. Experience 1955-1985," Journal of Financial Economics, 23 (August 1989) 225-249.
  7. Jarrell, Gregg A. and Michael Bradley, "The Economic Effects of Federal and State Regulation of Cash Tender Offers," Journal of Law and Economics, 23 (October 1980) 371-407.
  8. Mitchell, Mark L. and Jeffry M. Netter, "Triggering the 1987 Stock Market Crash: Antitakeover Provisions in the Proposed House Ways and Means Tax Bill," Journal of Financial Economics, 24 (September 1989) 37-68.
  9. Meulbroek, Lisa K., "An Empirical Analysis of Illegal Insider Trading," Journal of Finance, 47 (December 1992) 1661-1699.
  10. Shahrur, Husayn, "Industry Structure and Horizontal Takeovers: Analysis of Wealth Effects on Rivals, Suppliers, and Corporate Customers," Journal of Financial Economics, 76 (April 2005) 61-98.
  11. Stillman, Robert, "Examining Antitrust Policy Towards Horizontal Mergers," Journal of Financial Economics, 11 (April 1983) 224-240.

XII. Proxy Fights

  1. Brickley, James A., Ronald C. Lease, and Clifford W. Smith, "Ownership Structure and Voting on Antitakeover Amendments," Journal of Financial Economics, 20 (January 1988) 267-291.
  2. DeAngelo, Harry and Linda DeAngelo, "Proxy Contests and the Governance of Publicly Held Corporations," Journal of Financial Economics, 23 (June 1989) 29-59.
  3. Dodd, Peter and Jerold B. Warner, "On Corporate Governance: The Impact of Proxy Contests," Journal of Financial Economics, 11 (April 1983) 401-438.
  4. Gillan, Stuart L. and Starks, Laura T., "Corporate Governance Proposals and Shareholder Activism: The Role of Institutional Investors," Journal of Financial Economics, 57 (August 2000) 275-305.
  5. Mulherin, J. Harold and Annette B. Poulsen, "Proxy contests and corporate change: implications for shareholder wealth," Journal of Financial Economics, 47 (March 1998).
  6. Pound, John, "Proxy Contests and the Efficiency of Shareholder Oversight," Journal of Financial Economics, 20 (January 1988) 237-265.
  7. Pound, John, "Proxy Voting and the SEC: Investor Protection versus Market Efficiency," Journal of Financial Economics, 29 (October 1991) 241-285.

XIII. The Value of Corporate Control

  1. *Barclay, Michael J. and Clifford G. Holderness, "Negotiated Block Trades and Corporate Control," Journal of Finance, 46 (July 1991) 861-878.
  2. *Nenova, Tatiana, "The value of corporate voting rights and control: A cross-country analysis," Journal of Financial Economics, 68 (June 2003) 325-351.
  3. Barclay, Michael J. and Clifford G. Holderness, "Private Benefits from Control of Public Corporations," Journal of Financial Economics, 25 (December 1989) 371-395.
  4. DeAngelo, Harry and Linda DeAngelo, "Managerial Ownership of Voting Rights: A Study of Public Corporations with Dual Classes of Common Stock," Journal of Financial Economics, 14 (March 1985) 33-69.
  5. Doidge, Craig, "U.S. Cross-Listings and the Private Benefits of Control: Evidence from Dual-Class Firms," Journal of Financial Economics, 72 (June 2004) 519-533.
  6. Jarrell, Gregg A. and Annette B. Poulsen, "Dual-class Recapitalizations as Antitakeover Mechanisms: The Recent Evidence," Journal of Financial Economics, 20 (January 1988) 129-152.
  7. Lease, Ronald C., John J. McConnell, and Wayne H. Mikkelson, "The Market Value of Control in Publicly Traded Corporations," Journal of Financial Economics, 11 (April 1983) 439-471.
  8. Martin, Kenneth J. and John J. McConnell, "Corporate Performance, Corporate Takeovers, and Management Performance," Journal of Finance, 46 (June 1991) 671-687.
  9. Meeker, L. and O. Joy, "Price Premiums for Controlling Shares of Closely Held Bank Stock," Journal of Business, 53 (1980) 297-314.
  10. Mikkelson, Wayne H. and M. Megan Partch, "Managers' Voting Rights and Corporate Control," Journal of Financial Economics, 25 (December 1989) 263-290.
  11. Mřrck, R., Andrei Shleifer, and Robert W. Vishny, "Management Ownership and Market Valuation: An Empirical Analysis," Journal of Financial Economics, 20 (January 1988) 293-315.
  12. Stulz, René M., "Managerial Control of Voting Rights: Financing Policies and the Market for Corporate Control," Journal of Financial Economics, 20 (January 1988) 25-54.
  13. Stulz, René M., "Managerial Discretion and Optimal Financing Policies," Journal of Financial Economics, 26 (July 1990) 3-27.

XIV. Divestitures and Spinoffs

  1. *WMM, Ch. 11.
  2. *Brealey, Myers & Allen, Ch. 33.
  3. Ahn, Seoungpil and David J. Denis, "Internal Capital Markets and Investment Policy: Evidence from Corporate Spinoffs," Journal of Financial Economics, 71 (March 2004) 489-516.
  4. Comment, Robert and Gregg A. Jarrell, "Corporate Focus and Stock Returns," Journal of Financial Economics, 37 (January 1995) 67-87.
  5. Chemmanur, Thomas J. and An Yan, "A Theory of Corporate Spin-offs," Journal of Financial Economics, 72 (May 2004) 259-290.
  6. Daley, Lane, Mehrotra, Vikas, and Sivakumar, Ranjini, "Corporate focus and value creation: Evidence from spinoffs," Journal of Financial Economics, 45 (August 1997) 257-281.
  7. Desai, Hemang and Prem C. Jain, "Firm Performance and Focus: Long-Run Stock Market Performance Following Spinoffs," Journal of Financial Economics, 54 (October 1999) 75-101.
  8. Hite, Galen L. and J. E. Owers, "Security Price Reactions Around Corporate Spin-off Announcements," Journal of Financial Economics, 11 (December 1983) 409-436.
  9. Krishnaswami, Sudha , and Subramaniam, Venkat, "Information asymmetry, valuation, and the corporate spin-off decision," Journal of Financial Economics, 53 (July 1999) 73-112.
  10. Lang, Larry, Annette Poulsen, and René Stulz, "Asset Sales, Firm Performance, and the Agency Costs of Managerial Discretion," Journal of Financial Economics, 37 (January 1995) 3-37.
  11. Schipper, Katherine and Abbie Smith, "Effects of Recontracting on Shareholder Wealth: The Case of Voluntary Spin-offs," Journal of Financial Economics, 11 (December 1983) 437-467.
  12. Schipper, Katherine and Abbie Smith, "A Comparison of Equity Carve-outs and Seasoned Equity Offerings," Journal of Financial Economics, 15 (January 1986) 153-186.
  13. Schlingemann, Frederik P., Stulz, René M., and Walkling, Ralph A., "Divestitures and the Liquidity of the Market for Corporate Assets," Journal of Financial Economics, 64 (April 2002) 117-144.
  14. Slovin, Myron B., Marie E. Sushka, and Steven R. Ferraro, "A Comparison of the Information Conveyed by Equity Carve-outs, Spin-offs, and Asset Sell-offs," Journal of Financial Economics, 37 (January 1995) 89-104.

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