Why restructuring adds value: when subtracting is a goal

Article Abstract:

Divestiture of unsuitable or unprofitable corporate subsidiaries creates economic value for both the divesting and the acquiring corporation in two ways: the benefit of fit and the benefit of focus.The divesting corporation receives cash in advance for an economic entity of no value to itself and future value to the buyer, who also assumes its risk. As a benefit of focus, the corporation is free to concentrate on remaining assets. The critical element is knowing when to buy or sell, and to whom. This is generally the weakest link in making a divestiture decision.

Mergers, acquisitions and divestments, Corporate reorganizations, Corporate divestiture, Divestiture, Cost (Economics), Costs (Economics)

---

Earnings management by acquiring firms in stock for stock mergers

Article Abstract:

A study was conducted on stock to stock mergers completed between 1985 and 1990 to determine whether acquiring firms increase their stock price before the merger to reduce the acquisition cost. Results revealed that acquiring firms increase earnings in the periods prior to the merger deal. Moreover, results indicated that accounting manipulations by the acquiring firm to increase income are positively related to the size of the merger agreement.

Profits, Corporate profits

---

Board composition, ownership structure and hostile takeovers: Some UK evidence

Article Abstract:

Internal governance characteristics of UK hostile targets were compared with a control group of non-targets, to determine if takeovers aim to correct for weak internal governance, or if they are a last resort. A negative relationship between executive ownership and the likelihood of a hostile bid was highlighted, but it may be that executives with significant ownership stakes may be able to insulate themselves from a hostile bid.

Management, Corporate directors

Similar abstracts:

• Abstracts: The effect of taxes on production location. Tax-induced earnings management by firms with net operating losses
• Abstracts: Talking accounting: an ethnography of management knowledge in British and German brewers. Grolsch
• Abstracts: The role of accounting information, environment and management control in multi-national organizations. Canberra to Port Moresby: government accounting and budgeting for the early stages of devolution
• Abstracts: Added value: the link between performance measures. Plan now for customs duty big bang. Raising equity after Big Bang
• Abstracts: Personal selling and sales management: a relationship marketing perspective. Are you committing marketcide?

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.