Abstract
The author shows that private equity transactions 1) illustrate market-driven reactions to inefficient equity markets that result from the diffusion of equity ownership in the public firm and 2) form part of a larger market trend toward the market-oriented blockholder model—a hybrid ownership structure that offers the benefits of monitoring associated with concentrated ownership along with the benefits of promoting liquid and efficient capital markets associated with diffused ownership. The analysis also explores the regulatory implications of the trend. In particular, the author observes that policymakers display lack of awareness of the trend. Consequently, policymakers face the hazard 1) of amplifying embedded distortions within the U.S. securities regulatory framework and 2) of introducing what the author calls regulatory systemic risk into the framework. <b>TOPICS:</b>Private equity, risk management, exchanges/markets/clearinghouses, analysis of individual factors/risk premia
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
