Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers
分析经理人与股东在最优公司规模和现金分配上的利益冲突，尤其针对自由现金流量大的企业，解释债务如何降低代理成本、债务替代股利的原因，以及多元化收购为何常亏损。
The interests and incentives of managers and shareholders conflict over such issues as the optimal size of the firm and the payment of cash to shareholders. These conflicts are especially severe in firms with large free cash flows—more cash than profitable investment opportunities. The theory developed here explains 1) the benefits of debt in reducing agency costs of free cash flows, 2) how debt can substitute for dividends, 3) why “diversification ” programs are more likely to generate losses than takeovers or expansion in the same line of business or liquidation-motivated takeovers, 4) why the factors generating takeover activity in such diverse activities as broadcasting and tobacco are similar to those in oil, and 5) why bidders and some targets tend to perform abnormally well prior to takeover.