کد مقاله کد نشریه سال انتشار مقاله انگلیسی نسخه تمام متن
960570 929499 2006 31 صفحه PDF دانلود رایگان
عنوان انگلیسی مقاله ISI
IPOs, acquisitions, and the use of convertible securities in venture capital
موضوعات مرتبط
علوم انسانی و اجتماعی مدیریت، کسب و کار و حسابداری حسابداری
پیش نمایش صفحه اول مقاله
IPOs, acquisitions, and the use of convertible securities in venture capital
چکیده انگلیسی

This paper provides a new explanation for the use of convertible securities in venture capital. A key property of convertible preferred equity is that it allocates different cash flow rights, depending on whether exit occurs by acquisition or IPO. The paper builds a model with double moral hazard, where both the entrepreneur and the venture capitalist provide value-adding effort. The optimal contract gives the venture capitalist more cash flow rights in acquisitions than IPOs. This explains the use of convertible preferred equity, including automatic conversion at IPO. Contingent control rights are also important for achieving efficient exit decisions.

ناشر
Database: Elsevier - ScienceDirect (ساینس دایرکت)
Journal: Journal of Financial Economics - Volume 81, Issue 3, September 2006, Pages 649–679
نویسندگان
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