Market for corporate control (original) (raw)

The market for corporate control is the role of equity markets in facilitating corporate takeovers. This was first described in an article by HG Manne, "Mergers and the Market for Corporate Control". According to Manne: The lower the stock price, relative to what it could be with more efficient management, the more attractive the take-over becomes to those who believe that they can manage the company more efficiently. And the potential return from the successful takeover and revitalization of a poorly run company can be enormous.