Takeover measures and ownership structure of target firms

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The first and main research shows that the size of a toehold which is accumulated by a potential acquirer of a target firm depends on the inside ownership concentration of the firm, a ratio of the value of synergy created by the merger to the destroyed value by the takeover defense, and the threshold of the size of a toehold which is specified under a disclosure rule. The results shed additional lights on the decisions of the acquirer on the size of a toehold and the allocation of control right of the target firm in equilibrium.The second research analyzes the mechanism of which the market risk affects the investment decisions of a bank. Considering a bank which finances itself through a repo market, the research shows that the credit risk of the bank increases with the market risk. This research also shows the mechanism in which the bank terminates its investment in the midst of the investing project if the future liquidity in the market of the collateral asset is anticipated to be reduced by the bankruptcy of the bank.