NEWSLETTER of March 16, 2102
The following content has been added at finexpert:
Studies > M & A
White & Case
Newsletter - Corporate Jan/Feb 2012
A extensive summary of current topics in jurisdiction concerned with capital market like Squeeze-outs, insider trading, corporate governance and much more (in German). >more
Studies > Alternative Investments
Roland Berger Strategy Consultants
EUROPEAN PRIVATE EQUITY OUTLOOK 2012
This third European Private Equity Outlook offers an interesting experts assessment of the market and its development in 2012. >more
Studies > Macro
Deutsche Bank Research
VOR DEM COMEBACK: EINLAGEN BEI BANKEN
An overview on bank financing by customers deposits (in German). >more
Studies > Macro
Studies > Macro
Commerzbank Research
ECONOMICS AKTUELL: Konjunktursorgen, welche Konjunktursorgen
(in German). >more
Studies > Macro
Commerzbank Research
ECONOMICS AKTUELL: US-Konsum belebt sich trotz höherer Benzinpreise
(in German). >more
Publications > M & A
CEO Preferences and Acquisitions
Dirk Jenter and Katharina Lewellen
This paper explores the impact of target CEOs’ retirement preferences on the incidence, the pricing, and the outcomes of takeover bids. Mergers frequently force target CEOs to retire early, and CEOs’ private merger costs are the forgone benefits of staying employed until the planned retirement date. Using retirement age as an instrument for CEOs’ private merger costs, we find strong evidence that target CEO preferences affect merger patterns. The likelihood of receiving a takeover bid increases sharply when target CEOs reach age 65. The probability of a bid is close to 4% per year for target CEOs below age 65 but increases to 6% for the retirement-age group, a 50% increase in the odds of receiving a bid. This increase in takeover activity appears discretely at the age-65 threshold, with no gradual increase as CEOs approach retirement age. Moreover, observed takeover premiums and target announcement returns are significantly lower when target CEOs are older than 65, reinforcing the conclusion that retirement-age CEOs are more willing to accept takeover offers. These results suggest that the preferences of target CEOs have first-order effects on both bidder and target behavior. >more
