國立虎尾科技大學 |

Classified boards of directors.

Record Type:	Language materials, manuscript : Monograph/item
Title/Author:	Classified boards of directors./
Author:	Pompilio, David John.
Description:	1 online resource (131 pages)
Notes:	Source: Dissertations Abstracts International, Volume: 71-02, Section: A.
Contained By:	Dissertations Abstracts International71-02A.
Subject:	Finance. -
Online resource:	click for full text (PQDT)
ISBN:	9781109221985

Classified boards of directors.
Pompilio, David John.

Classified boards of directors. - 1 online resource (131 pages)

Source: Dissertations Abstracts International, Volume: 71-02, Section: A.

Thesis (Ph.D.)--Cornell University, 2009.

Includes bibliographical references

This dissertation constructs a unique, hand-collected dataset to empirically examine the motivation for, and consequences of, adopting a classified board of directors at the time of initial public offering. A classified board is a governance arrangement whereby the board of directors is divided into (usually three) classes. At each annual meeting of shareholders only one class comes up for election. Classified boards are a popular and, in many countries, uncontrovertible governance structure used by public companies. In the United States classified boards are controversial. This is because a classified board enables directors of US companies to deploy and maintain a "poison pill" when confronted with a hostile acquisition attempt in spite of possible opposition from their own shareholders. A poison pill is a device that dilutes the value of, and voting rights attached to, the putative acquirer's shareholding in the target company. By strengthening the effectiveness of the poison pill, classified boards potentially discourage the incidence of takeover attempts and thus deny shareholders the opportunity to receive large takeover premia. Recent research suggests classified boards are a manifestation of an agency problem between managers and shareholders and are associated with lower firm market values. The main result from the first part of the dissertation is that classified board adoption is more likely when a venture capital investor sits on the post-IPO board and the position of Chairman is occupied by someone other than the CEO. Adopting the conventional perspective that venture capital investors are concerned with maximizing the company's share price, this finding contrasts with the evidence that classified boards lead to lower values for established companies. Rather, the documented association between classified boards, venture capital participation and CEO-Chairman separation is consistent with the view that classified board adoption is motivated by a desire to establish and maintain the independence of non-CEO directors from the CEO. The second part of the dissertation examines the effects of classified board adoption at IPO on the incidence and outcome of subsequent takeover offer activity. Probit regression analysis suggests that, contrary to expectations, companies with a classified board are no less likely to receive a takeover offer up to five years after listing than those without a classified board. This result, along with the previously mentioned findings, challenges the view that managers of IPO companies deploy classified boards to entrench themselves from the threat of takeover when pre-IPO agency problems permit such an outcome.

Electronic reproduction.
Ann Arbor, Mich. :
ProQuest,
2024

Mode of access: World Wide Web

ISBN: 9781109221985Subjects--Topical Terms:

559073
Finance.
Subjects--Index Terms:

Antitakeover devicesIndex Terms--Genre/Form:

554714
Electronic books.

Classified boards of directors.
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500 $a Source: Dissertations Abstracts International, Volume: 71-02, Section: A.
500 $a Publisher info.: Dissertation/Thesis.
500 $a Advisor: Grinstein, Yaniv.
502 $a Thesis (Ph.D.)--Cornell University, 2009.
504 $a Includes bibliographical references
520 $a This dissertation constructs a unique, hand-collected dataset to empirically examine the motivation for, and consequences of, adopting a classified board of directors at the time of initial public offering. A classified board is a governance arrangement whereby the board of directors is divided into (usually three) classes. At each annual meeting of shareholders only one class comes up for election. Classified boards are a popular and, in many countries, uncontrovertible governance structure used by public companies. In the United States classified boards are controversial. This is because a classified board enables directors of US companies to deploy and maintain a "poison pill" when confronted with a hostile acquisition attempt in spite of possible opposition from their own shareholders. A poison pill is a device that dilutes the value of, and voting rights attached to, the putative acquirer's shareholding in the target company. By strengthening the effectiveness of the poison pill, classified boards potentially discourage the incidence of takeover attempts and thus deny shareholders the opportunity to receive large takeover premia. Recent research suggests classified boards are a manifestation of an agency problem between managers and shareholders and are associated with lower firm market values. The main result from the first part of the dissertation is that classified board adoption is more likely when a venture capital investor sits on the post-IPO board and the position of Chairman is occupied by someone other than the CEO. Adopting the conventional perspective that venture capital investors are concerned with maximizing the company's share price, this finding contrasts with the evidence that classified boards lead to lower values for established companies. Rather, the documented association between classified boards, venture capital participation and CEO-Chairman separation is consistent with the view that classified board adoption is motivated by a desire to establish and maintain the independence of non-CEO directors from the CEO. The second part of the dissertation examines the effects of classified board adoption at IPO on the incidence and outcome of subsequent takeover offer activity. Probit regression analysis suggests that, contrary to expectations, companies with a classified board are no less likely to receive a takeover offer up to five years after listing than those without a classified board. This result, along with the previously mentioned findings, challenges the view that managers of IPO companies deploy classified boards to entrench themselves from the threat of takeover when pre-IPO agency problems permit such an outcome.
533 $a Electronic reproduction. $b Ann Arbor, Mich. : $c ProQuest, $d 2024
538 $a Mode of access: World Wide Web
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653 $a Antitakeover devices
653 $a Boards of directors
653 $a Classified boards
653 $a Staggered boards
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710 2 $a Cornell University. $3 845492
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