IDEAS home Printed from https://ideas.repec.org/a/bla/econom/v59y1992i234p199-219.html
   My bibliography  Save this article

Takeover Defences and Shareholder Voting

Author

Listed:
  • Austen-Smith, David
  • O'Brien, Patricia C

Abstract

Why do shareholders vote for anti-takeover devices that apparently lower the value of their firm? The authors address this question by constructing an agenda-setting model in which rational, informed and value-maximizing shareholders vote on requests for such devices made by a self-interested management with employment opportunities outside the firm. They find sufficient conditions for the value of the firm to decline as a result of a request, although it is approved by shareholders. In their model, the apparently paradoxical voting behavior occurs because the expected takeover premium would be reduced more by rejection of the request than by approval, so shareholders rationally choose approval. Copyright 1992 by The London School of Economics and Political Science.

Suggested Citation

  • Austen-Smith, David & O'Brien, Patricia C, 1992. "Takeover Defences and Shareholder Voting," Economica, London School of Economics and Political Science, vol. 59(234), pages 199-219, May.
    • Handle: RePEc:bla:econom:v:59:y:1992:i:234:p:199-219
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0013-0427%28199205%292%3A59%3A234%3C199%3ATDASV%3E2.0.CO%3B2-3&origin=repec
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:ipg:wpaper:2014-604 is not listed on IDEAS
    2. repec:ipg:wpaper:2014-531 is not listed on IDEAS
    3. James M. Mahoney & Joseph T. Mahoney & Chamu Sundaramurthy, 1995. "The differential impact on stockholder wealth of various antitakeover provisions," Research Paper 9512, Federal Reserve Bank of New York.
    4. Bruno-Laurent Moschetto & Frédéric Teulon, 2015. "Optimisation d’une stratégie anti- opa par limitation linéaire des droits de vote face à un investisseur hostile," Revue économique, Presses de Sciences-Po, vol. 66(6), pages 1067-1088.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:econom:v:59:y:1992:i:234:p:199-219. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley-Blackwell Digital Licensing or Christopher F. Baum (email available below). General contact details of provider: https://edirc.repec.org/data/lsepsuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.