This paper demonstrates that warrant valuation and exercise strategy differ fundamentally from call option valuation. Simultaneous exercise of warrants is shown to be suboptimal and a monopolist owning all warrants can achieve a higher value. Unless warrants are perfectly divisible, no satisfactory equilibrium exists for the valuation and exercise of widely held warrants. The problems encountered appear to be quite general and stem from necessary assumptions about future corporate dividend policy and capital structure. Such assumptions are necessary for any model of corporate security valuation.

When securities are thinly traded OLS techniques yield biased beta estimates. Procedures for calculating consistent estimates are proposed by Scholes and Williams (1977) and by Dimson (1979). This comment examines both procedures and concludes that the Dimson procedure is incorrect and cannot generally be expected to yield consistent beta estimates. However, a variant of this procedure can yield results which are identical to Scholes and Williams' and is, therefore, correct.

This paper reviews much of the scientific literature on the market for corporate control. The evidence indicates that corporate takeovers generate positive gains, that target firm shareholders benefit, and that bidding firm shareholders do not lose. The gains created by corporate takeovers do not appear to come from the creation of market power. With the exception of actions that exclude potential bidders, it is difficult to find managerial actions related to corporate control that harm shareholders. Finally, we argue the market for corporate control is best viewed as an arena in which managerial teams compete for the rights to manage corporate resources.

This paper tests the hypothesis that the future distribution of payoffs provided by a common stock depends upon whether ownership of the stock also conveys control over the firm's activities. For 26 firms that had two classes of common stock outstanding, the class with superior voting rights traded at a premium relative to the other class. However, in four firms where the ownership structure of the firm also included a class of voting preferred stock, the class of common with superior voting rights traded at a significant discount relative to the class of common with inferior voting rights. The analysis suggests that there are both benefits and costs of corporate control.

‘Antitakeover’ amendments are amendments to a corporation's charter that impede the ability of an ‘outsider’ to gain control of the firm. A number of individuals and institutions have onjected to such amendments on the grounds that they are not in the best interests of the shareholders of the firms that adopt them. This paper employs event-time methodology to investigate the impact of antitakeover amendments on the common stock prices of firms that adopt them. The results indicate that the announcement of such amendments is associated with a positive revaluation of stock price. Contrary to the concerns of their critics, we conclude that antitakeover amendments are proposed by managers who seek to increase the value of the firm and are approved by stockholders who share that objective.