Creditors’ holdup, releveraging and the setting of private appropriation in a control contract between shareholders - HAL Accéder directement au contenu
Article dans une revue International Review of Law and Economics Année : 2021

Creditors’ holdup, releveraging and the setting of private appropriation in a control contract between shareholders

Résumé

Debt is analyzed in relation to the conflict between three parties, a controlling shareholder, outside investors and creditors. We follow Jensen and Meckling’s (1976) and Myers’ (1977) intuitions that leverage may result in excess value appropriation by creditors while at the same time acting to discipline private benefits appropriation. Creditors’ holdup refers to the appropriation by the incumbent debtholders of a large part of the additional value created by an incentivized controlling shareholder. This paper introduces a negotiation framework between controlling and outside shareholders in which releveraging and private benefits are decided while the process of value creation initiates a transfer of value to the creditors. The admissible contracts of control involve a minimum jump in leverage. This result gives a theoretical foundation for the leveraged recap decisions observed in the market and one-off variations of the capital structure.
Fichier principal
Vignette du fichier
S0144818821000478.pdf ( 769.24 Ko ) Télécharger
Origine : Fichiers produits par l'(les) auteur(s)
Loading...

Dates et versions

hal-03366329, version 1 (16-10-2023)

Licence

Paternité - Pas d'utilisation commerciale - CC BY 4.0

Identifiants

  • HAL Id : hal-03366329 , version 1

Citer

Hubert de La Bruslerie, Simon Gueguen. Creditors’ holdup, releveraging and the setting of private appropriation in a control contract between shareholders. International Review of Law and Economics, 2021, 68. ⟨hal-03366329⟩
68 Consultations
15 Téléchargements
Dernière date de mise à jour le 20/04/2024
comment ces indicateurs sont-ils produits

Partager

Gmail Facebook Twitter LinkedIn Plus