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White Paper

Market Crashes and Merger Completions

A primary concern in mergers and acquisitions is the risk that the deal may be cancelled before completion. We document that this "interim risk" varies asymmetrically with the aggregate stock market: When the market falls sharply, cash deals are more than twice as likely to be cancelled.

Book

Merger Arbitrage

How does one regulate systemic risk in the financial sector? We propose charging each financial firm a tax based on its expected loss during a systemic crisis.

Book

Takeovers, Restructuring and Corporate Governance

Mergers and acquisitions play an important role for companies and economies, yet a high number of M&A investments fail to earn their cost of capital. This book seeks to improve the success rate of M&A activities.

Book

A Clinical Exploration of Value Creation and Destruction in Acquisitions

How and why is value created or destroyed in mergers and acquisitions? To answer these questions, we present analyses of two acquisitions: Cooper Industries’ acquisition of Cameron Iron Works in 1989 and Premark’s acquisition of Florida Tile in 1990.

Journal Article

Lessons From Financial Economics

There is disagreement among financial economists about the meaning of efficiency, how to test for it and what the results of these tests mean.

Journal Article

Limited Arbitrage in Equity Markets

This paper examines impediments to arbitrage in equity markets using a sample of 82 situations between 1985 and 2000.

Journal Article

Restrictions on Short Selling

In this paper we review the theoretical and empirical evidence on both short sales and restrictions on short sales, concentrating on the uptick rule.

Journal Article

Shark Repellents and Managerial Myopia

Critics of hostile corporate takeovers frequently assert that takeover pressure forces managers to sacrifice profitable, but slow-yielding, long-term investments in favor of less-producting short-term investments that offer immediate returns.Evidence supporting takeover-induced short-sightedness, or myopia, is largely anecdotal, but a new economic model predicts that adopting measures to discourage takeovers — so-called shark repellent — will enable corporate managers to increase profitable long-term investments such as research and development (R&D).

Journal Article

Slow-Moving Capital

Unlike textbook arbitrageurs who instantaneously trade when prices deviate from fundamental values, real-world arbitrageurs must overcome various frictions.

Journal Article

New Evidence and Perspectives on Mergers

Empirical research has revealed a great deal about mergers and acquisitions trends and characteristics over the last century.