Return to results
Conference Proceedings (2002), AFFI Proceedings 2002, Association Française de Finance (AFFI)

Partial Acquisitions and Dilution of Minority Shareholders Wealth

CHARLETY-LEPERS Patricia , FAGART M.C., SOUAM S.

Our model examines the real economic (prices, quantities and profits) and financial (share prices, wealth transfers between shareholders) consequences of partial acquisitions in an oligopolistic market. Our results show that such operations done at the initiative of a controlling shareholder exist in equilibrium even in the absence of economies of scale, that they benefit the controlling shareholder, harm minority shareholders of his or the target company, benefit competitors and always harm consumers because of the increase in prices.

CHARLETY-LEPERS, P., FAGART, M.C. and SOUAM, S. (2002). Partial Acquisitions and Dilution of Minority Shareholders Wealth. In: AFFI Proceedings 2002. Association Française de Finance (AFFI).