Union Concessions Following Asset Sales and Takeovers

64 Pages Posted: 23 May 2018

See all articles by Erik Lie

Erik Lie

University of Iowa - Henry B. Tippie College of Business

Tingting Que

University of Alabama in Huntsville

Multiple version iconThere are 2 versions of this paper

Date Written: September 10, 2017

Abstract

We document that the likelihood of asset sales increases with union presence and union wages. Furthermore, acquiring firms gain significant concessions from the incumbent union following asset sales. Finally, the anticipation of union concessions helps explain the excess stock returns around asset sale announcements. We find no comparable effects for takeovers. We conclude that asset sales, but not takeovers, are partially motivated by the potential to extract concessions from unions.

Suggested Citation

Lie, Erik and Que, Tingting, Union Concessions Following Asset Sales and Takeovers (September 10, 2017). Journal of Financial and Quantitative Analysis (JFQA), Forthcoming, Available at SSRN: https://ssrn.com/abstract=3176606 or http://dx.doi.org/10.2139/ssrn.3176606

Erik Lie

University of Iowa - Henry B. Tippie College of Business ( email )

Acquisitions
5020 Main Library
Iowa City, IA 52242-1000
United States

Tingting Que (Contact Author)

University of Alabama in Huntsville ( email )

Huntsville, AL 35899
United States

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