Postprint version. Published in Review of Quantitative Finance and Accounting, Volume 3, Issue 4, January 1, 1993, pages 447-457.
NOTE: At the time of publication, the author Sanjiv Jaggia was not yet affiliated with Cal Poly.
The definitive version is available at https://doi.org/10.1007/BF02409622.
In this article, we focus on the question of target management resistance and the incidence of subsequent bids. A Poisson count data model is used where the dependent variable represents the number of bids (count) received and the independent variables comprise target management actions and firm specific characteristics. Of the target management actions considered, legal defense and the entry of a white knight are associated with additional bids. With respect to firm specific characteristics, we find that a high initial bid premium deters subsequent bids. Firm size is also significant and has an interesting relationship with the number of bids received. Larger target firms tend to receive more bids; however, the number of bids tails off for firms with assets exceeding $12 billion.