Controlling Shareholders and the Acquisition Premiums Paid in European Takeover Bids

M.F. Thraya and Jens Hagendorff
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M.F. Thraya: CERAG - Centre d'études et de recherches appliquées à la gestion - UPMF - Université Pierre Mendès France - Grenoble 2 - CNRS - Centre National de la Recherche Scientifique

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Abstract: This paper examines the incentives of controlling shareholders in the market for corporate control. We investigate the takeover premiums paid by a sample of European acquiring firms with concentrated voting rights structures. The results show a positive relationship between takeover premiums and the bidder's concentration of both voting rights and excess voting rights over cash-flow rights. With higher levels of bidder entrenchment, the valuation of a takeover target increasingly reflects the private benefits of control which bidders seek to extract from a deal

Keywords: Controlling shareholders; separation between the ownership and the control; takeover premiums; private benefits (search for similar items in EconPapers)
Date: 2010
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00534763v1
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Published in 2010

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00534763

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