Predicting Tender Offer Success: A Logistic Analysis

18 Pages Posted: 23 Sep 2008 Last revised: 30 Jul 2011

See all articles by Ralph A. Walkling

Ralph A. Walkling

Drexel University - Lebow College of Business

Date Written: July 28, 2011

Abstract

This research develops and tests a model for the prediction of tender offer outcomes. Variables that increase the supply of "obtainable shares" (such as increased bid premiums or the payment of solicitation fees ) are shown to increase the probability of success. Increased ownership of target firm shares by the bidder also incease the probability of success. Variables that impede the tendering of hares (such as target management opposition or a competing bid) decrease the probability of success. Tests of the model utilizing both linear and logistic analysis support the theoretical constructs and help resolve the paradoxical findings of previous research.

Suggested Citation

Walkling, Ralph August, Predicting Tender Offer Success: A Logistic Analysis (July 28, 2011). The Journal of Financial and Quantitative Analysis, Vol. 20, pp. 461-478, 1985, Available at SSRN: https://ssrn.com/abstract=918051

Ralph August Walkling (Contact Author)

Drexel University - Lebow College of Business ( email )

LeBow College of Business
Philadelphia, PA 19104
United States
(215) 895-4920 (Phone)
(215) 895-6119 (Fax)

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