Market for Corporate Control and Contractual Buyout (CoBO): A New “Collective Ownership-and-Administrative” Strategy

Reddy, Kotapati Srinivasa (2015): Market for Corporate Control and Contractual Buyout (CoBO): A New “Collective Ownership-and-Administrative” Strategy.

Abstract

Contractual buyout (CoBO) is a new “collective ownership and joint administrative strategy”, which gives an opportunity to buy a target firm in the given period when the given contract ends between acquirer, target firm, and financier. It is a takeover defensive method and tends to avail tax advantage via entering CoBO deal. In particular, it would be efficient inorganic magnetic for international venture capitalists and private equity firms while entering foreign markets. More specifically, CoBO is likely a concept of Dating-before-Merging and it would be the better model for cross-border mergers and acquisitions integration strategy. The explored CoBO propositions may be useful in various implications such as information symmetry and administrative changes, employment and employee role, operating performance and financial arrangement, tax savings, choice of market entry strategy, integration strategy, and government and policy makers. We recommend the developed country investors choose CoBO as investment vehicle to avail the competent business opportunities in both emerging and budding economies.

• Item Type: MPRA Paper
• Language: English
• Keywords: Contractual buyout; Collective ownership; Inorganic strategy; Leveraged buyout; Market for corporate control; Mergers and acquisitions; Strategic alliances, Takeovers
• Subjects: F - International Economics > F2 - International Factor Movements and International Business; F - International Economics > F2 - International Factor Movements and International Business > F21 - International Investment ; Long-Term Capital Movements; F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms ; International Business; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance; F - International Economics > F6 - Economic Impacts of Globalization; F - International Economics > F6 - Economic Impacts of Globalization > F63 - Economic Development; L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance; L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior; L - Industrial Organization > L5 - Regulation and Industrial Policy; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M1 - Business Administration; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M1 - Business Administration > M16 - International Business Administration

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