Contractual buyout - a legitimate growth model in the enterprise development: foundations and implications

K.S. Reddy, En Xie and Yuanyuan Huang

International Journal of Management and Enterprise Development, 2016, vol. 15, issue 1, 1-23

Abstract: The paper develops a new strategy framework in the enterprise development, especially associated with loss-making firms. A legitimate growth model, contractual buyout is a 'collective ownership and joint administrative policy' in the market for corporate control and also provides an option to buy target firm in a given contract between acquirer, target firm and financier. It posits alike to socio-culture trend 'dating before marriage'. The strategy is further described as takeover defensive method, tax benefit scheme, foreign market entry mode and post-merger integration approach. The model is precisely discussed in various taxonomies, such as motivations, foundations, illustrations, guidelines and implications. It eventually recommends capitalists and multinational enterprises to choose CoBO as a potential entry mode to avail creative business openings in the world economy.

Keywords: collective ownership; contractual buyout; enterprise development; inorganic strategy; joint ventures; leveraged buyout; corporate control; mergers and acquisitions; M%A; strategic alliances; takeovers; turnaround strategy; growth models; loss making firms; joint administrative policy; defensive takeover; tax benefits; foreign market entry mode; post-merger integration. (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (2)

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