The price of corporate liquidity: Acquisition discounts for unlisted targets

• 成果类型: Article
• 署名作者: Officer, Micah S.
• 署名单位: University of Southern California
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2006.01.004
• 发表日期: 2007
• 页码: 571-598
• 关键词: liquidity discounts; marketability discounts; unlisted targets; Private Firms

摘要

This paper documents average acquisition discounts for stand-alone private firms and subsidianes of other firms (unlisted targets) of 15% to 30% relative to acquisition multiples for comparable publicly traded targets. My results are strongly consistent with the notion that sale prices for unlisted targets are affected by both the need for, and availability of, the liquidity provided by the buyi.r. Corporate parents are significantly liquidity-constraincd prior to the sale of a subsidiary, particularly when the subsidiary is being sold for cash. Furthermore, acquisition discounts are significandy greater when debt capital is relatively more expensive to obtain, and when the parent firm has belowmarket stock returns in the 12 months prior to the sale. (c) 2006 Elsevier B.V. All rights reserved.