Title
Impact of Shareholder Proposals on the Functioning of the Market for Corporate Control
Source of Publication
Financial Review
Abstract
© 2017 The Eastern Finance Association Firms receiving shareholder proposals are 16% more likely to become a target of acquisition. Such companies earn approximately 7.2% lower acquisition returns compared to gains for targets with no proposals. Higher acquisition likelihood and lower target returns are primarily associated with proposals drawing a larger proportion of favorable votes, larger voter turnout, as well as with proposals submitted shortly before takeover announcements, and motivated by the removal of antitakeover provisions. Our findings suggest that shareholder proposals can assist bidders in the identification of targets or signal the willingness of target shareholders to accept bids with lower premiums.
Document Type
Article
First Page
347
Last Page
371
Publication Date
8-1-2017
DOI
10.1111/fire.12125
Recommended Citation
El-Khatib, Rwan; Fogel, Kathy; and Jandik, Tomas, "Impact of Shareholder Proposals on the Functioning of the Market for Corporate Control" (2017). Scopus Indexed Articles. 1301.
https://zuscholars.zu.ac.ae/scopus-indexed-articles/1301