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Full-Text Articles in Law

The Fair Value Of Cornfields In Delaware Appraisal Law, Lawrence Hamermesh, Michael L. Wachter Oct 2005

The Fair Value Of Cornfields In Delaware Appraisal Law, Lawrence Hamermesh, Michael L. Wachter

All Faculty Scholarship

The Delaware Supreme Court’s opinions in Weinberger and Technicolor have left a troublesome uncertainty in defining the proper approach to the valuation of corporate shares. That uncertainty – increasingly important as going private mergers become more frequent – can be resolved by a blend of financial and doctrinal analysis. The primary problem—the potential opportunism by controlling shareholders in timing going private mergers—can be addressed by a more complete understanding of corporate finance. The definition of fair value must include not only the present value of the firm’s existing assets, but also the future opportunities to reinvest free cash flow, including …


Why Defer To Managers? A Strong-Form Efficiency Model, Richard E. Kihlstrom, Michael L. Wachter Jul 2005

Why Defer To Managers? A Strong-Form Efficiency Model, Richard E. Kihlstrom, Michael L. Wachter

All Faculty Scholarship

We compare the efficiency with which management discretion and shareholder choice regulate hostile tender offers. This is the first paper in a long running debate that rigorously compares these legal rules to analyze both the critical informational assumptions and the interplay of those assumptions with principles of financial market efficiency. A critical innovation of our model is its focus on an informed management’s choice among alternative corporate policies under the protection of the business judgment rule, but where agency costs exist. We assume that corporate assets and reinvestment opportunities are efficiently priced by financial markets, but that markets never learn …


Improving The Efficiency Of The Angel Finance Market: A Proposal To Expand The Intermediary Role Of Finders In The Private Capital Raising Setting, John L. Orcutt Jan 2005

Improving The Efficiency Of The Angel Finance Market: A Proposal To Expand The Intermediary Role Of Finders In The Private Capital Raising Setting, John L. Orcutt

Law Faculty Scholarship

The angel finance market is of critical importance to the financing and creation of rapid-growth start-ups, whose continuous creation plays a substantial role in the success of the U.S. economy. Unfortunately, the angel finance market suffers from systematic problems, including information and agency problems and high transaction costs, that limit its ability to adequately finance these rapid-growth start-ups. One reason for the angel market's inefficiency is the lack of meaningful financial intermediaries that operate in the market. One logical group that could serve a meaningful intermediary role in the angel market is finders. The current regulatory treatment of finders, however, …


The Academic Tournament Over Executive Compensation, William W. Bratton Jan 2005

The Academic Tournament Over Executive Compensation, William W. Bratton

All Faculty Scholarship

No abstract provided.


The New Dividend Puzzle, William W. Bratton Jan 2005

The New Dividend Puzzle, William W. Bratton

All Faculty Scholarship

No abstract provided.