Surprisingly, bidders rarely acquire a target stake (toehold) prior to launching control bids, despite paying large takeover premiums. At the same time, toeholds are large when they occur, and toehold bidding is the norm in hostile takeovers. To...Read more
The European Commission has proposed a Takeover Directive that aims to make the control of European corporations more contestable. The European Parliament and Germany will not adopt the Directive unless it provides for reciprocity in takeovers,...Read more
This paper offers the first study of the shareholder welfare effects of poison pills and control share acquisition statutes in a research design that can support causal inference. We examine a series of four events between 2004 and 2010 that suddenly and exogenously changed the legality of poison pills and control share acquisition statutes for a peculiar class of company known as a closed-end fund. In the first two events, a court held for the first time that these defenses were legal under the Investment Company Act of 1940.