This study finds that highly levered firms lose substantial market share to their more conservatively financial competitors in industry downturns. Specifically, firms in the top leverage decile which experience output contractions see their sales decline by 26 percent more than do firms in the...

This paper investigates the causes and consequences of activist block share purchases in the 1980s. We find that activist investors were most likely to purchase large blocks of shares in highly diversified firms with poor profitability. Activists were not less likely to purchase blocks in firms...

This paper compares U.S. firms that issued or repurchased significant amounts of equity between 1978 and 1993 to those that issued or repurchased debt. We find that firms are most likely to increase debt and repurchase equity when they have less debt than is predicted by a cross-sectional...

This paper investigates the causes and consequences of activist block share purchases in the 1980s. We find that activist investors were most likely to purchase large blocks of shares in highly diversified firms with poor profitability. Activists were not less likely to purchase blocks in firms...

This paper investigates the determinants of leveraged buyout (LBO)activity by comparing firms that have implemented LBOs to those that have not. The analysis considers sources of gains from LBOs as well as the costs that can arise from the large amount of debt included in their financial...