In the Shleifer and Vishny (2003) model, overvalued bidders use equity to buy relatively undervalued targets. Why

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In the Shleifer and Vishny (2003) model, overvalued bidders use equity to buy relatively undervalued targets. Why do target firms agree to accept overvalued bidder stock? What is the empirical evidence?

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Behavioral Finance

ISBN: 9780190868741

1st Edition

Authors: H. Kent Baker, Greg Filbeck, John R. Nofsinger

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Question Posted: Feb 23, 2024 04:00 AM

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In the Shleifer and Vishny (2003) model, overvalued bidders use equity to buy relatively undervalued targets. Why

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There can be two related reasons First if Q P S then target shareholders gain in the short run but l...View the full answer

Behavioral Finance

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