Timings, terms and agency problems in mergers and acquisitions

Yuanbin Wang, Peijun Guo

Abstract

In this research, we analyse the timings, terms and agency problems in mergers and acquisitions where each firm optimally exercises its own exchange option and the timing and terms are determined endogenously. The theoretical analysis shows that the competition amongst the bidders will speed up merger and decrease the winning bidder's share in the post-merger firm; the agency problem will speed up or delay takeover. The managerial insights have been gained by the theoretical analysis.

Original languageEnglish
Pages (from-to)287-311
Number of pages25
JournalInternational Journal of Information and Decision Sciences
Volume7
Issue number4
DOIs
StatePublished - 2015

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Mergers and acquisitions

Keywords

  • Agency problem
  • Game theory
  • Mergers and acquisitions
  • Option

ASJC Scopus subject areas

  • Information Systems and Management
  • Strategy and Management
  • Management of Technology and Innovation
  • Computer Science Applications

Cite this

Timings, terms and agency problems in mergers and acquisitions. / Wang, Yuanbin; Guo, Peijun.

In: International Journal of Information and Decision Sciences, Vol. 7, No. 4, 2015, p. 287-311.

Research output: Contribution to journalArticle

Wang, Yuanbin; Guo, Peijun / Timings, terms and agency problems in mergers and acquisitions.

In: International Journal of Information and Decision Sciences, Vol. 7, No. 4, 2015, p. 287-311.

Research output: Contribution to journalArticle

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