Corporate Reorganizations and Non-Cash Auctions

@inproceedings{RhodesKropfCorporateRA,
  title={Corporate Reorganizations and Non-Cash Auctions},
  author={Matthew Rhodes-Kropf and Siva Viswanathan}
}
This paper extends the theory of non-cash auctions by considering the revenue and efficiency of using different securities. Research on bankruptcy and privatization suggests using non-cash auctions to increase cash-constrained bidder participation. We examine this proposal and demonstrate that securities may lead to higher revenue. However, bidders pool unless bids include debt, which results in possible repossession by the seller. This suggests all-equity outcomes are unlikely and explains the… CONTINUE READING
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