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Takeovers, Restructuring, and Corporate Governance

by: Weston, J. Fred; Mitchell, Mark L.; Mulherin, J. Harold

Takeovers, Restructuring, and Corporate Governance

by: Weston, J. Fred; Mitchell, Mark L.; Mulherin, J. Harold

ISBN 13:
9780131407374
ISBN 10:
0131407376
Edition: 4th
Format: Paperback
Copyright: 07/23/2003
Publisher: Pearson
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Summary

This book brings together conceptual and empirical material in a systematic way. It provides readers with a basis for understanding mergers and acquisitions and corporate restructuring that are introduced into every session of Congress.The volume provides a complete review of takeovers and mergers in practice, M&A's in theory and practice, the strategic perspective of valuation, restructuring, M&A strategies and strategies for creating value.For CEOs, COOs, CFOs and other top level executives.

Short Cases and Company Examples in Text

xxv

Preface

xxix

PART I: TAKEOVERS AND MERGERS IN PRACTICE

(101)

The Takeover Process

(23)

Change Forces

(1)

Issues Raised by M&A Activity

(1)

Merger and Tender Offer Terminology

(1)

Types of Mergers from an Economic Standpoint

(4)

Horizontal Mergers

(1)

Vertical Mergers

(1)

Conglomerate Mergers

(3)

Mergers in a Legal Framework

(1)

The Nature of Tender Offers

(2)

Risk Arbitrage in M&A Activity

(2)

Illustrative Example

(1)

The Nature of the Arbitrage Business

(1)

Arbitrage Funds

(1)

Summary

(1)

Questions

(1)

Appendix A: Merger Process Information in Proxy Statements

(3)

Appendix B: The AOL and Time Warner Merger

(4)

The Legal and Regulatory Framework

(46)

The Main Securities Laws

(4)

Federal Securities Laws

(3)

The Operation of the Securities Acts

(1)

Tender Offer Regulation---The Williams Act

(2)

Section 13

(1)

Section 14

(1)

Insider Trading Overview

(1)

The Racketeer Influenced and Corrupt Organizations Act of 1970 (RICO)

(1)

Court Cases and SEC Rules

(3)

Liability Under Rule 10b-5 of the 1934 Act

(2)

Other Disclosure Requirements

(2)

Disclosure Requirements of Stock Exchanges

(1)

Disclosure of Merger Talks

(1)

Regulation of Takeover Activity by the States

(2)

Developments During the 1980s

(1)

Issues with Regard to State Takeover Laws

(1)

Antitrust Policies

(1)

The Basic Antitrust Statutes

(2)

Sherman Act of 1890

(1)

Clayton Act of 1914

(1)

Hart-Scott-Rodino Act of 1976

(1)

The Antitrust Guidelines

(3)

Other Market Characteristics

(1)

Nonhorizontal Mergers

(1)

Private Antitrust Suits

(1)

State Antitrust Activity

(1)

Regulatory Bodies

(1)

Railroads

(1)

Commercial Banks

(1)

Telecommunications

(1)

International Antitrust

(3)

Canada

(1)

United Kingdom

(1)

Japan

(1)

Europe

(2)

Regulation by Publicity

(2)

Seizure of the First Executive Corporation and First Capital Life

(1)

The Hostile Takeover of the Pacific Lumber Company

(1)

Regulation by the Politics of Finance

(1)

Summary

(1)

Questions

(6)

Case 2.1 Broader Board Responsibilities

(1)

Case 2.2 Van Gorkom

(1)

Case 2.3 Revlon Inc. v. Pantry Pride

(1)

Case 2.4 Maxwell Communications v. Macmillan

(1)

Case 2.5 Paramount v. Time

(1)

Case 2.6 Paramount v. QVC Network

(1)

Case 2.7 Sandoz-Gerber

(1)

Case 2.8 United Airlines and US Airways

(1)

References

(2)

Appendix A: Legal Due Diligence Preliminary Information Request

(10)

Accounting for M&As

(21)

Historical Background

(2)

Pooling of Interests

(2)

Defects in Pooling

(1)

FASB Elimination of Pooling

(1)

Purchase Accounting

(5)

Purchase Accounting Adjustment Entries

(3)

Amortization and Impairment Rules

(2)

Empirical Studies of Pooling Versus Purchase

(3)

Summary

(1)

Questions

(6)

Case 3.1 Wells Fargo Acquisition of First Interstate Bancorporation

(3)

Case 3.2 Time Warner (TWX) Purchase of the Turner Broadcasting System (TBS) in 1996

(1)

Case 3.3 The AOL Acquisition of Time Warner (TWX)

(2)

Case 3.4 The Pfizer Acquisition of Pharmacia

(1)

References

(2)

Deal Structuring

(11)

Taxation and Acquisitions

(1)

Taxable Versus Nontaxable Acquisitions

(2)

The Tax Reform Act of 1986

(1)

Stock Versus Asset Purchases

(2)

Empirical Studies of Taxes and Mergers

(1)

Form of Payment

(3)

Stock Mergers with Collars

(1)

Earnouts in Mergers

(1)

Summary

(1)

Questions

(2)

Case 4.1 Form of Payment in the First Union and Money Store Merger

100

(1)

References

101

(1)

PART II: M&As---THEORIES AND EMPIRICAL TESTS

102

(130)

Strategic Processes

102

(28)

The Nature of Strategy

102

(1)

Successful Strategies

102

(2)

The Importance of the Economic Environment

104

(2)

The Investment Accelerator Principle

104

(1)

Sales-to-Capacity Relationships

105

(1)

Basic Steps in Strategic Planning

106

(8)

Monitoring the Organizational Environment

107

(1)

Stakeholders

107

(1)

Organizational Cultures

107

(1)

Alternative Strategy Methodologies

107

(4)

Alternative Analytical Frameworks

111

(3)

Approaches to Formulating Strategy

114

(2)

The Boston Consulting Group

114

(1)

The Porter Approach

115

(1)

Adaptive Processes

116

(1)

Evaluation of the Alternative Approaches

116

(2)

Checklists and Iterations

116

(1)

Flexibility and Rapid Adjustments

117

(1)

Formulating a Merger Strategy

118

(2)

Business Goals

118

(1)

Aligning the Firm to Its Changing Environment

119

(1)

Strategy and Structure

120

(2)

Virtual Integration

122

(1)

Strategy and M&A Decisions

122

(1)

Summary

123

(1)

Questions

123

(5)

Case 5.1 Merck Acquisition of Medco

124

(2)

Case 5.2 Acquisition of Lotus Development Corporation by IBM

126

(2)

References

128

(2)

Theories of Mergers and Tender Offers

130

(41)

Some Initial Examples of the Merger Process

130

(2)

Hewlett-Packard and Compaq

130

(2)

Northrop Grumman and TRW

132

(1)

Merger Occurrence: Economies of Scale and Transaction Costs

132

(2)

Size and Returns to Scale

133

(1)

Transaction Costs and Mergers

133

(1)

Theories of the Valuation Effects of Mergers and Acquisitions

134

(2)

Mergers as Value-Increasing Decisions

134

(1)

Mergers as Value-Reducing Decisions

135

(1)

Managerial Hubris and Mergers

135

(1)

Theoretical Predictions of the Patterns of Gains in Takeovers

136

(1)

The Merger Process

136

(2)

An Example of the Bidding Process: The Acquisition of Savannah Foods

137

(1)

Models of the Takeover Bidding Process

138

(2)

The Winner's Curse

139

(1)

Bidder Costs

139

(1)

Seller Decisions

140

(1)

An Example of a Takeover Auction

140

(2)

Summary

142

(1)

Questions

142

(1)

References

143

(1)

Appendix A: A Chemical Industry Case Study

144

(8)

Appendix B: Measurement of Abnormal Returns

152

(19)

The Timing of Merger Activity

171

(24)

Conceptual Framework

171

(1)

Early Merger Movements

172

(1)

The 1895 to 1904 Horizontal Mergers

172

(1)

The 1922 to 1929 Vertical Mergers

173

(1)

The Conglomerate Mergers of the 1960s

173

(3)

The Deal Decade, 1981 to 1989

176

(2)

Strategic Mergers, 1992--2000

178

(2)

Merger Activity After the Bubble

180

(1)

Timing of Merger Activity

180

(1)

Industry Clustering in Merger Activity

181

(2)

Industry Clustering in the 1980s

181

(1)

Industry Clustering in the 1990s

182

(1)

Extended Analysis of Industry Clustering

183

(1)

Mergers and Deregulation

183

(2)

Industry Clustering and Deregulation

183

(1)

Deregulation, Mergers, and Performance

184

(1)

International Perspectives

185

(1)

Summary

185

(1)

Questions

186

(1)

References

186

(2)

Appendix A: Telecommunications Industry Case Study

188

(7)

Empirical Tests of M&A Performance

195

(37)

The Combined Returns in Mergers and Acquisitions

195

(3)

Combined Returns: Event Study Evidence

195

(1)

Combined Returns: Extended Analysis

196

(1)

Combined Merger Returns: Analysis of the Banking Industry

196

(2)

Factors Related to Target Returns

198

(4)

Target Returns: Type of Merger and Method of Payment

198

(1)

Target Returns: Single Versus Multiple Bidders

199

(1)

Target Run-Up

199

(3)

Takeover Bidding and Takeover Premiums

202

(1)

Factors Related to Bidder Returns

202

(3)

Bidder Returns and Method of Payment

202

(2)

Bidder Returns: Single Versus Multiple Bidders

204

(1)

Do Bad Bidders Become Good Targets?

205

(1)

Takeover Regulation and Takeover Hostility

205

(1)

Measuring the Effect of the Williams Act

205

(1)

Takeover Impediments in the 1980s

206

(1)

Is Hostility in the Eyes of the Beholder?

206

(1)

Postmerger Operating Performance

206

(1)

Long-Term Stock Price Performance Following Mergers

207

(3)

General Issues

207

(1)

Long-Term Merger Performance

208

(1)

Summary Comments on Long-Term Price Performance

209

(1)

Efficiency Versus Market Power

210

(2)

Which Firms Are Subject to Antitrust Enforcement?

210

(1)

The Effect of Mergers on Rival Firms

210

(1)

Further Analysis of Industry Spillovers

211

(1)

Vertical and Horizontal Mergers

211

(1)

Effects of Concentration

212

(1)

Impact on Macroconcentration

212

(1)

Impact on Microconcentration

213

(1)

Summary

213

(1)

Questions

214

(1)

References

215

(3)

Appendix A: Analysis of a Recent M&A Sample

218

(14)

PART III: VALUATION---THE STRATEGIC PERSPECTIVE

232

(56)

Alternative Approaches to Valuation

232

(24)

Comparables Approaches

232

(5)

Comparable Companies Analysis

232

(1)

Comparable Transactions Analysis

233

(2)

Application of Comparable Transactions Analysis

235

(2)

The DCF Spreadsheet Methodology

237

(6)

Capital Budgeting Decisions

237

(1)

A Real Options Analysis

238

(2)

Spreadsheet Projections

240

(3)

Brief Evaluation of the Spreadsheet Approach

243

(1)

Cost of Capital

243

(3)

Cost of Equity

243

(2)

Cost of Debt

245

(1)

Weighted Average Cost of Capital

245

(1)

Capital Structure and the Cost of Capital

246

(2)

Formula Approach

248

(3)

The Basic Formula

248

(2)

Sensitivity Analysis

250

(1)

Summary

251

(1)

Questions

251

(1)

References

252

(1)

Appendix A: Derivation of Revenue Growth Valuation Formulas

253

(3)

Increasing the Value of the Organization

256

(32)

The Exxon-Mobil Merger

256

(4)

Industry Characteristics

257

(1)

Merger Motivations

257

(1)

Deal Terms and Event Returns

258

(2)

Cost of Capital Calculations

260

(1)

Application of the DCF Percentage-of-Sales Method to ExxonMobil

261

(3)

DCF Formula Valuation

264

(8)

Sensitivity Analysis

264

(4)

Test of Merger Performance

268

(4)

Tests of Merger Theory

272

(1)

Review

273

(1)

Multiple-Stage Valuation

274

(3)

Summary

277

(1)

Problems

278

(5)

References

283

(1)

Appendix A: Calculating Growth Rates

284

(4)

PART IV: RESTRUCTURING

288

(68)

Corporate Restructuring and Divestitures

288

(23)

Corporate Restructuring Strategies

288

(1)

Definitions of Corporate Restructuring

288

(2)

Asset Sales, Equity Carve-Outs, and Spin-Offs

289

(1)

Split-Ups, Tracking Stock, and Exchange Offers

290

(1)

Examples of Corporate Restructuring: AT&T Corporation

290

(3)

The Baby Bell Breakup in 1984

291

(1)

Restructuring in the 1990s

291

(1)

Restructuring Since 2000

292

(1)

Other Examples of Restructuring and Divestitures

293

(1)

The Auto Parts Industry: GM-Delphi and Ford-Visteon

293

(1)

Restructuring at Philip Morris

293

(1)

Restructuring at Pete's Brewing

294

(1)

Some Discussion of Restructuring Motives

294

(1)

Why Might Divestitures Create Wealth?

295

(1)

Modigliani, Miller, and Irrelevance

295

(1)

Corporate Restructuring, Incentives, and Efficiency

295

(1)

Corporate Restructuring and Information

295

(1)

Why Do Divestitures Occur?

296

(1)

Corporate Restructuring and Transaction Costs: The Petrochemical Industry

297

(1)

Corporate Restructuring and Change Forces: The Natural Gas Industry

298

(1)

Summary

299

(1)

Questions

299

(1)

References

300

(1)

Appendix A: Restructuring in the Diversified Natural Gas Industry in the 1990s

301

(10)

Empirical Tests of Corporate Restructuring and Divestitures

311

(17)

The Wealth Effects of Restructuring and Divestitures

311

(3)

Are Divestitures a Positive NPV Project?

311

(1)

Sources of Wealth Gains: Evidence from Asset Sales

312

(2)

Sources of Wealth Gains: Information versus Efficiency

314

(1)

Corporate Focus

314

(3)

Focus and the Wealth Effects of Corporate Divestitures

314

(2)

Focus, Diversification, and Firm Value

316

(1)

Is There Really a Diversification Discount?

317

(1)

Corporate Choice: How to Divest?

317

(1)

Summary

318

(1)

Questions

319

(1)

References

319

(2)

Appendix A: Analysis of a Sample of Recent Divestitures

321

(7)

Financial Restructuring

328

(28)

Unlocking the Value in the Firm

328

(1)

Leverage and Leveraged Recapitalizations

329

(6)

The Effects of the Use of Leveraged Recaps

332

(2)

Subsequent Performance

334

(1)

Dual-Class Stock Recapitalizations

335

(2)

Reasons for Dual-Class Recapitalizations

335

(1)

Market Response to Dual-Class Recaps

335

(1)

Paradox of the Entrenchment

336

(1)

Exchange Offers

337

(3)

Tax Aspects of Exchange Offers

337

(1)

Empirical Evidence on Exchange Offers

338

(2)

Reorganization Processes

340

(2)

Out-of-Court Procedures

340

(1)

Merger into Another Firm

341

(1)

Formal Legal Proceedings

341

(1)

Bankruptcy

342

(5)

Recent Data on Bankruptcy

342

(1)

Bankruptcy Procedures

343

(4)

Financial Engineering

347

(1)

Liquidations and Takeover Bust-Ups

348

(3)

Empirical Studies

349

(2)

Summary

351

(1)

Questions

352

(1)

Case 13.1 Management Assistance, Incorporated

352

(1)

References

353

(3)

PART V: M&A STRATEGIES

356

(128)

Alliances and Joint Ventures

356

(23)

Joint Ventures

357

(8)

Uses of Joint Ventures

358

(1)

Joint Ventures and Business Strategy

359

(1)

Joint Ventures and Restructuring

359

(2)

Rationale for Joint Ventures

361

(1)

Failure and Success

362

(1)

Empirical Tests

363

(2)

Strategic Alliances

365

(7)

Uses of Strategic Alliances

366

(2)

Other Issues

368

(1)

Event Studies

369

(1)

Successful Strategic Alliances

370

(1)

Relative Roles

371

(1)

Other Interfirm Relationships

372

(2)

Minority Equity Investments

372

(1)

Technological and Marketing Agreements

373

(1)

Franchising

374

(1)

Summary

374

(2)

Questions

376

(1)

Case 14.1 GM-Toyota Joint Venture

376

(1)

References

377

(2)

Employee Stock Ownership and MLPs

379

(27)

Nature and History of ESOPs

379

(4)

Types of Pension Plans

379

(1)

Types of ESOPs

380

(1)

ESOPs as Pension Plans

381

(1)

Concept of a Leveraged ESOP

382

(1)

Uses of ESOPs

383

(3)

Comparison with a Merger

383

(2)

ESOPs in Lieu of Subsidiary Divestitures

385

(1)

Other Uses of ESOPs

385

(1)

Data on ESOP Characteristics

386

(2)

Tax Advantages

388

(2)

Interest Exclusion

388

(1)

Dividend Deduction

388

(1)

Deferment of Capital Gains Tax

389

(1)

Tax Loss Carryforwards

389

(1)

Excess Pension Asset Reversions

389

(1)

Conclusions on Tax Benefits

389

(1)

The Performance of ESOPs

390

(4)

ESOPs as a Takeover Defense

390

(1)

ESOPs Versus Alternative Methods of Raising Funds

390

(1)

Comparison with Profit Sharing

391

(1)

Effects on Company Productivity

392

(2)

Economic Issues

394

(1)

ESOP Event Returns

395

(1)

Evaluation of ESOPs

396

(1)

Master Limited Partnerships

397

(2)

The Nature of MLPs

397

(1)

The Boston Celtics Example

398

(1)

Advantages of MLPs

398

(1)

Initial Pricing of MLPs

399

(1)

Summary

399

(1)

Questions

400

(4)

Case 15.1 Pan Petroleum MLP

401

(1)

Case 15.2 UAL Corp

402

(2)

References

404

(2)

Going Private and Leveraged Buyouts

406

(40)

The Characteristics of LeverageD Buyouts

407

(1)

The Major Stages of Leveraged Buyouts

407

(3)

Characteristics of LBOs in the 1980s

410

(16)

General Economic and Financial Factors

410

(1)

Illustration of an LBO

411

(2)

Elements of a Typical LBO Operation

413

(1)

Other Aspects of Going-Private Buyouts in the 1980s

414

(1)

Empirical Results of Going Private in the 1980s

415

(3)

Sources of Gains

418

(6)

Evidence of Postbuyout Equity Value

424

(2)

The Correction Period 1991 to 1992

426

(1)

The Role of Junk Bonds

427

(3)

LBOs in the 1992 to 2000 Period

430

(1)

Valuation of LBOs

431

(2)

Summary

433

(1)

Questions

434

(1)

Problems

434

(4)

References

438

(2)

Appendix A: Relation Between WACC and CCF Models

440

(3)

Appendix B: Relation Between CCF and APV Models

443

(3)

International Takeovers and Restructuring

446

(38)

Historical Patterns

446

(1)

Large Cross-Border Transactions

446

(8)

Examples of Cross-Border Transactions

454

(6)

Forces Driving Cross-Border Mergers

460

(4)

Growth

461

(1)

Technology

461

(1)

Advantages in Differentiated Products

462

(1)

Roll Ups

462

(1)

Consolidation

462

(1)

Government Policy

463

(1)

Exchange Rates

463

(1)

Political and Economic Stability

463

(1)

Following Clients

464

(1)

Diversification

464

(1)

Premiums Paid

464

(1)

Event Returns

465

(2)

International Joint Ventures

467

(2)

Cost of Capital in Foreign Acquisitions and Investments

469

(5)

Cost of Debt Relationships

469

(2)

Cost of Equity and Cost of Capital

471

(3)

Summary

474

(1)

Questions

475

(7)

Case 17.1 The Saga of Gerber Products

476

(2)

Case 17.2 Ciba-Geigy Merger with Sandoz

478

(2)

Case 17.3 Vodafone Airtouch Takeover of Mannesmann

480

(2)

References

482

(2)

PART VI: STRATEGIES FOR CREATING VALUE

484

(177)

Share Repurchases

484

(41)

Growth of Share-Repurchase Activity

484

(3)

Major Types of Share Repurchase

487

(2)

Fixed-Price Tender Offers (FPTs)

487

(1)

Dutch Auctions (DAs)

488

(1)

Transferable Put Rights (TPRs)

488

(1)

Open-Market Repurchases (OMRs)

488

(1)

Fixed-Price Tender Offers (FPTs)

489

(3)

Basic Stock Repurchase Model

489

(2)

Rationale for the Postexpiration Price Changes

491

(1)

Dutch Auction Repurchases

492

(3)

Transferable Put Rights (TPRs)

495

(3)

Event Studies

498

(7)

Undervaluation in the 1970s

498

(1)

Share Repurchases Around the October 1987 Stock Market Drop

498

(2)

Comparisons Between FPTs, DAs, and OMRs

500

(1)

Lagged Responses

500

(1)

The Mitchell and Stafford (2000) Methodology Critique

500

(1)

Event Returns in the 1990s

501

(1)

The Impact of Stock Market Declines

501

(1)

Implications of Gains and Losses from Share Repurchases

501

(4)

A Model of Undervaluation

505

(3)

Accounting Treatment of Share Repurchases

508

(2)

Empirical Studies of Share Repurchases in the 1990s

510

(1)

The Measurement of Share-Repurchase Growth

511

(1)

Related Dividend Studies

512

(2)

The Substitution Issue

514

(3)

Summary

517

(2)

Questions

519

(3)

Case 18.1 FPL

520

(1)

Case 18.2 Returns from Open-Market Repurchase Announcements

521

(1)

References

522

(3)

Takeover Defenses

525

(33)

Strategic Perspectives

525

(2)

Financial Defensive Measures

527

(1)

Corporate Restructuring and Reorganization

527

(1)

Reorganization of Assets

527

(1)

Other Strategies

528

(1)

Greenmail

528

(3)

Wealth Effects of Greenmail

529

(1)

Antigreenmail Developments

530

(1)

Methods of Resistance

531

(1)

Pac Man Defense

531

(1)

White Knight

532

(1)

White Squire

532

(1)

Antitakeover Amendments

532

(6)

Supermajority Amendments

533

(1)

Fair-Price Amendments

533

(1)

Classified Boards

533

(1)

Authorization of Preferred Stock

534

(1)

Other Antitakeover Actions

534

(1)

Antitakeover Amendments and Corporate Policy

535

(1)

Antitakeover Amendments and Shareholder Returns

536

(2)

Takeover Defenses of Newly Public Firms

538

(1)

State Laws

538

(1)

Poison Pills

539

(3)

Types of Plans

539

(1)

Case Studies

539

(1)

Dead-Hand Provisions

540

(1)

Effects of Poison Pills on Shareholder Returns

541

(1)

Shareholder Activism

542

(1)

Poison Puts

543

(1)

Golden Parachutes

544

(3)

Rationale

545

(1)

Silver and Tin Parachutes

546

(1)

Golden Parachutes and Returns to Shareholders

546

(1)

Summary

547

(2)

Questions

549

(6)

Case 19.1 Carter Hawley Hale Versus Marshall Field & Company

550

(1)

Case 19.2 Mattel-Hasbro

551

(1)

Case 19.3 Hershey Foods Saga

552

(3)

References

555

(3)

Corporate Governance and Performance

558

(38)

Governance Failure

558

(4)

Corporate Fraud

558

(2)

Regulatory Responses

560

(2)

An Overview of Corporate Governance

562

(1)

Corporate Governance Systems in the United States

563

(1)

Diffuse Stock Ownership

563

(1)

Contractual Theory of the Firm

563

(1)

Divergent Interests of Stakeholders

564

(1)

Internal Control Mechanisms

564

(1)

Role of the Board of Directors

565

(3)

Composition of the Board

565

(2)

Compensation of Board Members

567

(1)

Evaluating a Board of Directors

567

(1)

Ownership Concentration

568

(4)

Ownership and Performance

568

(2)

Other Studies of Ownership Effects

570

(1)

Managerial Ownership and Bond Returns

571

(1)

Financial Policy and Ownership Concentration

571

(1)

Executive Compensation

572

(2)

Outside Control Mechanisms

574

(3)

Stock Prices and Top Management Changes

574

(1)

Institutional Investors

575

(2)

Multiple Control Mechanisms

577

(1)

Proxy Contests

577

(4)

Wealth Effects--Early Studies

578

(1)

Wealth Effects--Later Studies

579

(2)

The M&A Market for Control

581

(1)

Alternative Governance Systems

582

(1)

Summary

583

(2)

Questions

585

(7)

Case 20.1 Chrysler Corporation Versus Tracinda Corporation---A Struggle for Control

586

(1)

Case 20.2 WorldCom

587

(3)

Case 20.3 AOL Time Warner

590

(2)

References

592

(4)

Merger Arbitrage

596

(43)

Merger Arbitrage Scenarios

597

(10)

Cash Deals

597

(3)

Stock Mergers

600

(5)

Complex Merger Transactions

605

(2)

Empirical Research on Merger Arbitrage

607

(8)

Risk and Return to Merger Arbitrage

607

(3)

Do Merger Arbitrageurs Accurately Forecast Merger Success?

610

(2)

Price Pressure Around Mergers

612

(1)

Floating-Exchange Ratio Mergers

613

(2)

Merger Arbitrage in Action

615

(5)

The Mechanics of Trading

616

(1)

The Challenge of Stock Mergers

617

(1)

The Monitoring Process

618

(2)

Summary

620

(1)

Questions

620

(2)

Case 21.1 Cheap Tickets, Incorporated-Cendant Corporation

621

(1)

References

622

(1)

Appendix A: Conoco Incorporated--Phillips Petroleum

623

(2)

Appendix B: Proposed HotJobs.com, Limited and TMP Worldwide, Inc. Merger Selected Commentary by DealAnalytics.com

625

(10)

Appendix C: Illustrative Portfolio Recommendations

635

(2)

Appendix D: Illustrative Portfolio Recommendations Summary

637

(2)

Implementation and Management Guides for M&As

639

(22)

M&As in a Strategic, Long-Range Planning Framework

640

(4)

Goals and Objectives

640

(1)

The Role of Strategy

641

(2)

The Role of Planning

643

(1)

Managerial Capabilities Perspective

643

(1)

The Foundation for Sound M&A Decisions

644

(5)

Strategic Planning Framework

645

(1)

Real Options Framework

646

(3)

The Acquisition Process

649

(9)

Strategy Formulation

649

(1)

The Economics of the Industry

649

(2)

The Organization System

651

(1)

Multiple Strategies for Value Growth

651

(1)

Search Processes

652

(1)

Economic Basis--Synergy Potentials

652

(1)

Restructuring Potentials

653

(1)

Due Diligence

653

(1)

Expanding Due Diligence

653

(1)

Cultural Factors

654

(1)

Valuation

655

(1)

Negotiation

656

(1)

Deal Structuring

656

(1)

Implementation

657

(1)

Reviews and Renewal Process

657

(1)

Summary

658

(1)

Questions

659

(1)

References

659

(2)

Glossary

661

(16)

Author Index

677

(6)

Subject Index

683

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Takeovers, Restructuring, and Corporate Governance

Takeovers, Restructuring, and Corporate Governance

9780131407374

0131407376

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Amazon no longer offers textbook rentals. We do!

Takeovers, Restructuring, and Corporate Governance

Takeovers, Restructuring, and Corporate Governance

9780131407374

0131407376

Summary

Table of Contents

Supplemental Materials

Excerpts

Write a Review

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