Management buyout proposals and inside information

Article Abstract:

This paper explores stock price behavior surrounding withdrawn buyout proposals to determine whether managers' proposal announcements reveal any information which is unrelated to the efficiency gains associated with completed buyouts. On average, firms whose managers withdraw buyout proposals do not sustain significantly positive stock price effects unless they receive subsequent acquisition bids. In addition, managers of firms with completed buyouts are no more likely to have access to inside information than managers who withdrew proposals. I interpret this evidence as inconsistent with the notion that inside information commonly motivates management buyout proposals. (Reprinted by permission of the publisher.)

Management buyouts, Insider trading in securities, Insider trading (Securities)

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A Comparison of Centralized and Fragmented Markets with Costly Search

Article Abstract:

The costs incurred by liquidity traders in searching for better quotes is incorporated into a model that shows centralized markets' expected spreads are smaller and are preferred by liquidity traders, but fragmented markets are preferred by market makers.

Science & research, Stocks, Behavior, Comparative analysis, Stock prices, Liquidity (Finance), Market makers (Securities trading), Stock markets, Stock market

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