Investors' perceptions of the Delaware Supreme Court decision in Unocal v. Mesa

Sreenivas Kamma; Joseph Weintrop; Peggy Wier

doi:10.1016/0304-405x(88)90052-9

Journal of Financial Economics Vol. 20 1988

Investors' perceptions of the Delaware Supreme Court decision in Unocal v. Mesa

Sreenivas Kamma^1,2; Joseph Weintrop^1,2; Peggy Wier^3,4

¹ Indiana University Bloomington · ² University at Buffalo, State University of New York · ³ University of Oregon · ⁴ University of Rochester

Abstract

In 1985 the Delaware Supreme Court allowed the Unocal Corporation to make a tender offer for its own shares to all holders except Mesa Partners II, who were attempting to gain control of Unocal. The Unocal decision and Mesa's response are associated with abnormal losses for shareholders of other Delaware firms that appeared to be targets of hostile takeover attempts at the time. These losses suggest that investors believed the decision would increase Delaware managers' ability to resist takeovers to the disadvantage of target shareholders.

DOI: 10.1016/0304-405x(88)90052-9
Volume: 20
Pages: 419-430
Language: en
Sources: bibtex:phds-export.bib openalex crossref

Investors' perceptions of the Delaware Supreme Court decision in Unocal v. Mesa

Abstract

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