How Does Equity Structure Impact M&A Decision? a Model Based on Private Benefits

Abstract:

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This paper focus on the private benefit of large shareholder’s control right within the framework of Agency Theory 2 and construct a model which can illustrate how M&A decision can be impacted by acquirer’s equity structure. The model internalizes large shareholder’s private benefit as a function of the shareholding ratio and specifies the mechanism through which large shareholder’s shareholding ratio and ownership concentration impact the M&A decision. This paper provides theoretical foundation for those empirical literatures which analyze the M&As from the perspective of Agency Theory 2.

Info:

Periodical:

Advanced Materials Research (Volumes 271-273)

Edited by:

Junqiao Xiong

Pages:

742-747

DOI:

10.4028/www.scientific.net/AMR.271-273.742

Citation:

Z. Jia and L. Y. Han, "How Does Equity Structure Impact M&A Decision? a Model Based on Private Benefits", Advanced Materials Research, Vols. 271-273, pp. 742-747, 2011

Online since:

July 2011

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Price:

$35.00

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