Acquisition
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- 13 Jan 2020
- Research & Ideas
Do Private Equity Buyouts Get a Bad Rap?
Elizabeth Warren calls private equity buyouts "Wall Street looting," but a recent study by Josh Lerner and colleagues shows they have both positive and negative impacts. Open for comment; Comment(s) posted.
- 05 Nov 2019
- Working Paper Summaries
The Economic Effects of Private Equity Buyouts
Private equity buyouts are a major financial enterprise that critics see as dominated by rent-seeking activities with little in the way of societal benefits. This study of 6,000 US buyouts between 1980 and 2013 finds that the real side effects of buyouts on target firms and their workers vary greatly by deal type and market conditions.
- 21 Aug 2019
- Working Paper Summaries
Improving Customer Compatibility with Operational Transparency
Service firms seeking prospective customers usually highlight the advantages of their offerings and downplay the tradeoffs. This study suggests a different approach: Provide transparency into advantages as well as tradeoffs. The transparency helps customers make informed decisions and can lead to better outcomes for both firms and customers over the long run.
- 05 Jun 2019
- Research & Ideas
If Your Customers Don't Care What You Charge, What Should You Charge?
Consumer inertia is the tendency of some customers to buy a product, even when superior options exist. Alexander J. MacKay discusses how that habit affects competitive strategy and even regulatory oversight. Open for comment; Comment(s) posted.
- 04 Jun 2019
- Working Paper Summaries
Political Influence and Merger Antitrust Reviews
This paper uses a large sample of United States mergers between 1998 and 2010 to study how political connections help firms obtain favorable antitrust regulatory outcomes for mergers. Given that antitrust regulators are subject to congressional oversight, the authors predict and find evidence that outcomes systematically favor firms that are constituents of politicians serving on judiciary committees.
- 30 May 2019
- Working Paper Summaries
US Antitrust Law and Policy in Historical Perspective
Since the late 19th century, American antitrust law and policy has responded to multiple changes: technological advances that have transformed business structures, political imperatives that have reformed regulations and informed prosecutorial discretion, and economic theories that have reshaped the boundaries of government interventions into the economy. Today, antitrust remains a contested field.
- 10 Apr 2019
- Working Paper Summaries
Trade Secrets Protection and Antitakeover Provisions
The study examines managers’ responses when facing an increased threat of their firm being acquired. Results add to our knowledge of the use of antitakeover provisions, showing that managers, particularly in high-innovation firms, increase certain provisions to protect long-term innovation output in the presence of elevated acquisition risk.
- 14 May 2018
- Research & Ideas
Amazon vs. Whole Foods: When Cultures Collide
Amazon's acquisition of Whole Foods seemed a Wall Street dream come true. But then Amazon's data-driven efficiency met the customer-driven culture at Whole Foods—and the shelves began to empty. Dennis Campbell and Tatiana Sandino discuss their new case study. Open for comment; Comment(s) posted.
- 12 Feb 2018
- Working Paper Summaries
Private Equity, Jobs, and Productivity: Reply to Ayash and Rastad
In 2014, the authors published an influential analysis of private equity buyouts in the American Economic Review. Recently, economists Brian Ayash and Mahdi Rastad have challenged the accuracy of those findings. This new paper responds point by point to their critique, contending that it reflects a misunderstanding of the data and methodology behind the original study.
- 25 Jan 2016
- Research & Ideas
When Negotiating a Price, Never Bid with a Round Number
Investors who offer “precise” bids for company shares yield better outcomes than those who offer round-number bids, according to research by Petri Hukkanen and Matti Keloharju. Open for comment; Comment(s) posted.
- 03 Sep 2009
- What Do You Think?
Are Retention Bonuses Worth the Investment?
There is a time and place for retention bonuses but they should be used sparingly, wrote many respondents to this month's column, says Professor Jim Heskett. Others challenged the value of bonuses, and suggested compelling alternatives. (Online forum now closed; next forum begins October 2.) Closed for comment; 42 Comment(s) posted.
- 15 Dec 2008
- Research & Ideas
The Surprisingly Successful Marriages of Multinationals and Social Brands
What happens when small iconic brands associated with social values—think Ben & Jerry's—are acquired by large concerns—think Unilever? Can the marriage of a virtuous mouse and a wealthy elephant work to the benefit of both? Professors James E. Austin and Herman B. "Dutch" Leonard discuss their research. Closed for comment; 0 Comment(s) posted.
- 28 Nov 2005
- Research & Ideas
Unilever: Transformation and Tradition
In a new book, professor Geoffrey Jones looks at Unilever's decades-old transformation from fragmented underperformer to focused consumer products giant. This epilogue summarizes the years 1960 to 1990. Closed for comment; 0 Comment(s) posted.
- 02 Apr 2001
- Research & Ideas
Not All M&As Are Alike—and That Matters
In this Harvard Business Review article, Professor Joseph L. Bower shares some of the results of his year-long study of M&A activity sponsored by HBS. Discover how five distinct merger and acquisition strategies scenarios play out—and his recommendations for success. Closed for comment; 0 Comment(s) posted.
Weak Credit Covenants
Prior to the 2020 pandemic, the leveraged loan market experienced an unprecedented boom, which came hand in hand with significant changes in contracting terms. This study presents large-sample evidence of what constitutes contractual weakness from the creditors’ perspective.