Posted by Mira Ganor, University of Texas at Austin, on Tuesday, June 13, 2017
Editor's Note: Mira Ganor is Professor at the University of Texas at Austin. This post is based on a recent article by Professor Ganor, forthcoming in the NYU Journal of Law & Business.
In my article, Toe Hold Collaborations beyond Insider Trading, recently made available on SSRN (forthcoming in the NYU Journal of Law & Business) I analyze the novel practice of investors co-purchasing toeholds (“TH”) and show that this practice can include profit sharing arrangements that distort the parties’ incentives and may lead to inefficient outcomes. With the proliferation of wolf-packing, the incidence of TH collaborations is likely to increase as well.