TY - JOUR
T1 - Takeover threats, antitakeover amendments and stock price reaction
AU - Lauterbach, Beni
AU - Malitz, Ileen B.
AU - Vu, Joseph
PY - 1991/12
Y1 - 1991/12
N2 - We examine the influence of takeover threats on the stock price of firms proposing antitakeover amendments. Stock prices of the majority of firms, which are not takeover targets during the four years surrounding the amendments, are unaffected, while prices of firms that become takeover targets within two years increase significantly. We document weak evidence of wealth losses only for a sample of prior targets. Our findings suggest that shareholders of the average firm are not harmed by antitakeover amendments because they provide either a better bargaining position or an information signal to the market.
AB - We examine the influence of takeover threats on the stock price of firms proposing antitakeover amendments. Stock prices of the majority of firms, which are not takeover targets during the four years surrounding the amendments, are unaffected, while prices of firms that become takeover targets within two years increase significantly. We document weak evidence of wealth losses only for a sample of prior targets. Our findings suggest that shareholders of the average firm are not harmed by antitakeover amendments because they provide either a better bargaining position or an information signal to the market.
UR - http://www.scopus.com/inward/record.url?scp=84986847137&partnerID=8YFLogxK
U2 - 10.1002/mde.4090120611
DO - 10.1002/mde.4090120611
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AN - SCOPUS:84986847137
SN - 0143-6570
VL - 12
SP - 499
EP - 510
JO - Managerial and Decision Economics
JF - Managerial and Decision Economics
IS - 6
ER -