This paper, which was prepared for a University of Illinois College of Law symposium
honoring Prof. Larry Ribstein, examines the origins of the market for corporate control
in the United States. The standard historical narrative is that the market for corporate control took on its modern form in the mid-1950s with the emergence of the cash tender offer.
Using hand-collected data from newspaper reports, we show that there in fact were numerous instances during the opening decade of the 20th century where a bidder sought to obtain voting control by purchasing shares on the stock market. Moreover, share-forshare exchange tender offers were used to make takeover bids as early as 1901, and cash tender offers can be traced back to at least the mid-1940s. We argue that the way in which cash tender offers came to dominate the market for control after World War II can be explained primarily by changes in the pattern of share ownership and of the opportunities bidders had for ?managing? the stock price of intended targets.
A 1970 New York Times essay on corporate social responsibility by Milton Friedman is often said to have launched a shareholder-focused reorientation of managerial priorities in America’s public companies. The essay correspondingly is a primary...Read more
Institutional shareholder stewardship codes (‘stewardship codes’) exist in many jurisdictions. They reflect the growing importance of institutional shareholders in capital markets, and a belief that increased engagement by institutional...Read more
This paper examines the effect of disclosure regulation on the takeover market. We study the implementation of a recent European regulation that imposes tighter disclosure requirements regarding the financial and ownership information on public...Read more
A popular research design identifies the effects of corporate governance by (changes in) state laws, clustering standard errors by state of incorporation. Using Monte-Carlo simulations, this paper shows that conventional statistical tests based...Read more