IDEAS home Printed from https://ideas.repec.org/a/oup/rfinst/v32y2019i2p771-817..html

Hostile Resistance to Hedge Fund Activism

Author

Listed:
  • Nicole M Boyson
  • Pegaret Pichler

Abstract

When facing hedge fund activists, target firms often fight back. Targets with agency problems and those confronting the threat of investor coordination frequently engage in hostile resistance by implementing governance changes associated with managerial entrenchment. The market negatively responds to hostile resistance, and unless hedge funds counterresist, these campaigns have worse operating performance, faster activist exit, and fewer mergers than do campaigns without hostile target resistance. By contrast, when hedge funds counterresist with proxy fights, lawsuits, or unsolicited tender offers, the impact of hostile target resistance is reversed, and these campaigns have similar outcomes to campaigns without hostile target resistance. Received September 8, 2016; editorial decision March 18, 2018 by Editor Francesca Cornelli.

Suggested Citation

  • Nicole M Boyson & Pegaret Pichler, 2019. "Hostile Resistance to Hedge Fund Activism," The Review of Financial Studies, Society for Financial Studies, vol. 32(2), pages 771-817.
    • Handle: RePEc:oup:rfinst:v:32:y:2019:i:2:p:771-817.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/rfs/hhy058
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:rfinst:v:32:y:2019:i:2:p:771-817.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/sfsssea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.