Deformation of Acquisition Price

Deformace akviziční ceny

Barbora Rýdlová and Tomáš Krabec

Oceňování, 2024, vol. 17, issue 2, 27-35

Abstract: This article focuses on the analysis of acquisition price distortions in the context of mandatory takeover bids, with particular attention to the decision of the Supreme Court of the Czech Republic (resolution 29 Cdo 293/2017) and the legal framework of the former Commercial Code. The aim is to assess the fairness of the mandatory offer price in relation to market conditions and the market value of the relevant securities. Alternative valuations using valuation models are considered as a supportive tool, relevant only when there are reasons to believe that the market exhibits signs of distortion. The article identifies key factors that may influence the stock price during an acquisition, including market competition structure, investor motivations and characteristics, time pressure, information asymmetry, and other aspects. These factors are then analyzed in terms of their potential to cause distortions in the acquisition price.

Keywords: Manadatory takeover bid; Acquisition price; Market deformation; Povinná nabídka převzetí; Akviziční cena; Prémiová cena; Deformace trhu (search for similar items in EconPapers)
JEL-codes: G30 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.18267/j.ocenovani.295

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