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- Title
WEALTH CREATION AND BID RESISTANCE IN U.K. TAKEOVER BIDS.
- Authors
Holl, Peter; Kyriazis, Dimitris
- Abstract
In this paper we investigate the determinants of, and relationship between, wealth creation and bid resistance for a sample of 178 successful takeover bids in the U.K. Within the context of an event study approach we test a range of hypotheses against a background that recognizes the existence of agency conflict and the role of corporate governance mechanisms designed to mitigate its effect. The results obtained are interpreted within the context of the U.K. corporate environment. We find that wealth creation and bid resistance are mutually dependent on each other. We find evidence suggesting the presence of managerial and financial synergy but the absence of operational synergy. Our results also suggest that there is some conflict between managers arid shareholders but that significant monitoring is exercised by the particular governance mechanisms we investigate.
- Subjects
UNITED Kingdom; MERGERS &; acquisitions; TENDER offers; CORPORATE governance; OFFER &; acceptance (Contracts); INTERORGANIZATIONAL relations; BRITISH corporations; ORGANIZATIONAL behavior; CORPORATE culture; PREVENTION
- Publication
Strategic Management Journal (John Wiley & Sons, Inc.) - 1980 to 2009, 1997, Vol 18, Issue 6, p483
- ISSN
0143-2095
- Publication type
Article
- DOI
10.1002/(SICI)1097-0266(199706)18:6<483::AID-SMJ895>3.0.CO;2-6