The Impact of Boardroom Characteristics of Acquiring Company on Propensity to Hostile Takeovers

In this paper, we analyzed the relationship between the board characteristics of the acquiring company and the probability of its hostile takeover. The most important boardroom characteristics within our survey are fraction of female directors, fraction of independent directors and multiple directorship.Hypothesizes are tested on a sample of Russian public companies during 1999-2015 with a probit regression and the average marginal effects method. It was found that women representation on the board is positively correlated to the probability of hostile takeover, but independent directors negatively related with it. Within the analyzed sample a positive relationship between the price of the transaction and its hostile character is also established in the case of hostile takeover. The acquirer has to create additional incentives for sale in condition of top management resistance. However, the study does not reveal that the presence of directors with multiple employment affects the hostile takeover probability. The paper consists of 3 parts, 54 pages, 10 tables, 3 diagrams, 2 histograms and reference list.