| Summary: | 碩士 === 國立屏東科技大學 === 財務金融研究所 === 95 === At the end of nineteen century, the first wave of merger and acquisitions occurred in America. Then, with the change of time trends and business types, it took place different kinds merger and the scale was bigger. After business merger and acquisitions law put into operation in our country, the cases of businesses merger and acquisitions increases quickly. Most businesses in Taiwan have family attribute and prefer to companionate culture. Therefore, when they want to grow up by merger and acquisitions, they would take friendly way first to negotiate with the target firm and discuss related detail.
During merger and acquisitions negotiation process, one question of both concern is the merger and acquisitions price, it is one of key factors whether the merger and acquisitions can success or not. This article sets up a game theory model. Extending Rubinstein (1982) complete information dynamic bargaining game (suggestion-response) uses backward induction of game theory to find out subgame perfect Nash equilibrium to discuss the process of friendly merger and acquisitions bargaining process.
In two stage game, there are different characteristics because of both discount factors.
1. When both of them are no patient, the bidding company has
first-mover advantage, and offers first can get better payoff.
2. When the bidding company is patient and the target company is no patient, bidding company offers first can not get better advantage.
3. When the bidding company is no patient and the target company is patient, the bidding company has first-mover advantage, and offers first can get better payoff.
4. When both of them are patient, the bidding company must compare synergy with reservation payoff to decide whether the bidding company offers first is good or not: when synergy bigger than reservation payoff, the bidding company has last-mover advantage, and offers latter can get better payoff; when synergy smaller than reservation payoff, the bidding company should offer first, and show related advantage to attract the will of the target company.
In unlimited stage game, the bidding company has first-mover advantage, and offers first can get better payoff.
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