@article{discovery10154224, number = {2}, journal = {The Journal of Finance}, title = {Auctions with Endogenous Initiation}, year = {2024}, pages = {1353--1403}, note = {This version is the author accepted manuscript. For information on re-use, please refer to the publisher's terms and conditions.}, publisher = {Wiley-Blackwell}, month = {April}, volume = {79}, issn = {0022-1082}, url = {https://doi.org/10.1111/jofi.13288}, abstract = {We study initiation of takeover auctions by potential buyers and the seller. A bidder's indication of interest reveals that she is optimistic about the target. If bidders' values have a substantial common component, as in takeover battles between financial bidders, this effect disincentivizes bidders from indicating interest, and auctions are seller-initiated. Conversely, in private-value auctions, such as battles between strategic bidders, equilibria can feature both seller- and bidder-initiated auctions, with the likelihood of the latter decreasing in commonality of values and the probability of a forced sale by the seller. We also relate initiation to bids and auction outcomes.}, author = {Gorbenko, Alexander and Malenko, Andrey} }