ISSN:
1573-7179
Keywords:
acquisitions
;
divestitures
;
agency
;
unified model
Source:
Springer Online Journal Archives 1860-2000
Topics:
Economics
Notes:
Abstract The purpose of this paper is to unify corporate acquisitions and divestitures (e.g., spin-offs, equity carve-outs and sell-offs) into a simple but comprehensive agency model where risk and managerial incentives interact to determine an optimal corporate governance and an incentive compensation scheme. Emphasizing human and nonhuman aspect of corporate assets, the model not only explains existing empirical evidence regarding contractual and organizational changes, but also suggests new perspective regarding firms' behavior around corporate acquisitions and divestitures. Thus, it attempts to reconcile between synergistic and agency viewpoints in the takeover literature and provides determining factors in choosing between spinoffs and equity carve-outs.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1023/A:1008267819853
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