Chapter 3

The Corporate Takeover Market: Common Takeover Tactics, Antitakeover Defenses, and Corporate Governance

Abstract

Corporate governance refers to the rules and processes by which a business is controlled, regulated, or operated. This chapter explains the factors that impact governance both internal and external to the firm, with a particular focus on the role of corporate takeovers in disciplining failing corporate managers. Significant attention is paid to the pivotal role of the board of directors in promoting good corporate governance and in overseeing the M&A process. Common takeover strategies ranging from friendly to hostile buyouts and tactics including bear hugs, proxy contests, and tender offers are discussed in detail. The ...

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