Arbeitspapier
Horizontal mergers with synergies: first-price vs. profit-share auction
We consider takeover bidding in a Cournot oligopoly when firms have private information concerning the synergy effect of merging with a takeover target. Two auction rules are considered: standard first-price and profit-share auctions, supplemented by entry fees. Since non-merged firms benefit from a merger if the synergies are low, bidders are subject to a positive externality. Nevertheless, pooling does not occur; and the profit-share auction is strictly more profitable than the first-price auction, regardless of whether firms observe the synergy parameter or only the winning bid before they play the oligopoly game.
- Language
-
Englisch
- Bibliographic citation
-
Series: SFB/TR 15 Discussion Paper ; No. 336
- Classification
-
Wirtschaft
Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
Auctions
Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Oligopoly and Other Imperfect Markets
Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection
- Subject
-
Horizontal mergers
takeovers
auctions
externalities
oligopoly
Übernahme
Auktionstheorie
Synergie
Asymmetrische Information
Oligopol
Spieltheorie
Theorie
- Event
-
Geistige Schöpfung
- (who)
-
Ding, Wei
Fan, Cuihong
Wolfstetter, Elmar G.
- Event
-
Veröffentlichung
- (who)
-
Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
- (where)
-
München
- (when)
-
2010
- DOI
-
doi:10.5282/ubm/epub.13218
- Handle
- URN
-
urn:nbn:de:bvb:19-epub-13218-0
- Last update
-
10.03.2025, 11:41 AM CET
Data provider
This object is provided by:
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Ding, Wei
- Fan, Cuihong
- Wolfstetter, Elmar G.
- Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
Time of origin
- 2010
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