Activities of Arbitrageurs in Tender Offers

Mining Edgar Tender Offers

This paper describes how use the HTMLEditorKit to perform web data mining on EDGAR (Electronic Data-Gathering, Analysis, and Retrieval system). EDGAR is the SEC’s (U.S. Securities and Exchange Commission) means of automating the collection, validation, indexing, acceptance, and forwarding of submissions. Some entities are regulated by the SEC (e.g. publicly traded firms) and are required, by la...

Tender Offers versus Block Trades: Empirical Evidence

In this paper we test whether the determinant of a block trade and tender offer probabilities differ and whether the relative magnitude of the security and private benefits can explain the choice of transfer mode. We investigate the Swedish market for corporate control and use the wedge between cash flow rights and voting rights as a proxy for the incentives to extract private benefits. Our res...

Do Firms Undertake Self-Tender Offers to Optimize Capital Structure?*

Companies occasionally announce that they undertake self-tender offers to optimize their capital structure. For example, in January 1997, James M. Usdan, president and chief executive officer of RehabCare Group, stated that “the use of cash and borrowing to fund the tender offer will result in a more efficient capital structure for the company” (Business Wire, January 31, 1997). Further, the an...

Stampeding Shareholders and Other Myths: TargetShareholders and Hostile Tender Offers

Arbitrageurs, bubbles and credit conditions

This paper studies a pure exchange economy populated by three types of agents: constrained agents who are subject to participation constraints, unconstrained agents who are only subject to a standard solvency constraint, and arbitrageurs who, in addition to being unconstrained, may incur transitory losses that are bounded by a state-dependent credit limit. We show that this credit possibility i...