The Merger Boom: An Overview
نویسندگان
چکیده
Battles for corporate control have increasingly attracted the public spotlight. This attention reflects not only the growth in the number of acquisitions in the 1980s but also the size of the targets. Firms previously thought too large to be takeover targets have been acquired despite active management opposition. Any acquisition, and particularly one involving sizable assets, is likely to result in disruptions. Employees may be reassigned or laid off, suppliers may be changed, investment programs may be cut back. The prospect of such changes may encourage those threatened by acquisitions to form a coalition with current management in supporting such defensive strategies as restrictive corporate charter amendments, antitakeover legislation, and active litigation. These takeover battles and the resulting increase in public interest in takeovers have led policymakers and academics to consider whether current takeover procedures appropriately balance all the competing interests. In the fall of 1987 the Federal Reserve Bank of Boston brought together financial economists, industrial organization specialists, government officials and representatives of the business and investment communities to examine the reasons for the current merger and acquisition wave, the implications for economic performance, and the appropriate public policy responses. At the conference, The Merger Boom, two views of mergers and acquisitions and two approaches to the study of mergers were represented. Financial economists, relying on stock market data and portfolio models, generally have a positive view of mergers and acquisitions. The
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