Evidence on the effects of hostile and friendly tender offers on employment
Diane Kowalski Denis
Managerial and Decision Economics, 1994, vol. 15, issue 4, 341-357
Abstract:
This paper provides evidence on the effects of successful tender offers on the number of target and acquiring firm employees. No significant change in combined employment is observed, on average, over the three-year period following offer completion. However, hostile tender offers completed between 1980 and 1984 are followed by an average 17.2% decline in employment. Net divestitures of operations over the period are responsible for some of the observed employment decrease; however, an estimated ‐12.2% change remains, on average, after adjusting for divestiture activity. Information contained in firm annual reports and in the Wall Street Journal indicates that the tender offers in the sample are often followed by considerable restructuring activity with respect to both target and acquiring firm operations. The findings suggest that acquiring firm managements may acquire new operations when the need to restructure their existing operations frees up resources, e.g. cash and/or managerial time and talent. The evidence also suggests that the corporate control market must be viewed as an integral part of the process by which US firms restructure to meet changing circumstances.
Date: 1994
References: Add references at CitEc
Citations: View citations in EconPapers (1)
Downloads: (external link)
http://hdl.handle.net/10.1002/mde.4090150408
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:15:y:1994:i:4:p:341-357
Access Statistics for this article
Managerial and Decision Economics is currently edited by Antony Dnes
More articles in Managerial and Decision Economics from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().