In this paper we examine the value of the right to design the method of sale of corporate assets. The question we ask is simple - who should have the right to decide how the assets of the firm should be sold? We show that this right is a valuable one and its value comes from recognizing the...

This case study is a review of knowledge management practices at Tata Consultancy Services – an increasingly global IT consulting firm headquartered in Mumbai – which has enabled it to meet ambitious growth targets over the past 5 years. The case also narrates some of the continuing...

This paper considers bidding environments with pure common values, in which bidders are not equally well informed. We construct the optimal selling mechanism and ask how bidder asymmetry affects the seller's expected payoff. With an optimal mechanism, the seller benefits from bidder asymmetry:...

We develop and test an explanation for the rights issue paradox that stems from risk of offering failure. Firms can reduce failure risk by getting underwriting or by self-insuring through subscription price discounts and subscription precommitments. Self-insurance is generally regarded to be...

We study endogenous participation in asymmetric second price auctions where one bidder is "special". We show seller revenue decreases whenever the special bidder becomes more dominant in the sense of FOSD, or more generally whenever the other bidders' profits are reduced. We also establish an...

Many acquisitions are conducted by clubs, i.e., coalitions of acquirers that submit a single bid. We present a novel analysis of club bidding where the club creates value by aggregating, at least partially, bidders' values. We show that club formation can lead to higher acquisition prices when...

We show that put warrant issues can be used to signal a firm's superior prospects to a market that is not aware of them. One benefit of using put warrants to signal, particularly for growth firms, is that a firm receives cash when sending the signal, instead of paying out cash. We establish...

Accounting measurements of firms' investments are usually imprecise. We study the economic consequences of such imprecision in a setting where accounting imprecision interacts with information asymmetry regarding the ex ante profitability of the project that is privately known by the firm's...

In this paper we model a corporate manager's choice of a disclosure regime. In a model in which disclosure has no efficiency gains like reduced cost of capital, no legal implications, and no signaling motivations, we show that a manager may choose to disclose payoff-relevant information as a...

We show that put warrants can reduce financing costs when managers know more about the firm's future prospects than do outside investors. Put warrants are shown to be an efficient security in eliminating adverse selection costs in that firms can credibly reveal favorable private information...