گزینه های سهام و سرمایه انسانی شرکت خاص کارکنان تحت خطر حذف و ادغام

This paper considers whether the first-best level of firm-specific human capital investment is attained by the use of stock option plans for workers and stock offers in acquisitions even though workers are threatened with the possibility of a divestiture and acquisition. We show that the first-best level of investment is achieved by a stock option plan with a positive exercise price for workers conditional on the event of a divestiture. We also suggest that, under certain conditions, a stock offer in acquisition can resolve a collusion problem between the target firm (TF) and its workers.

Although potential distortion in firm-specific human capital investment in divestiture and acquisition decisions has been the subject of extensive academic work, the role of stock option plans for workers and stock offers in such decisions has largely been ignored. The purpose of this paper is to explore whether the first-best level of firm-specific human capital investment is attained by the use of stock option plans for workers and stock offers in acquisitions even though divestiture and acquisition decisions affect the ability of firms to contract efficiently with workers. We first consider a situation in which one firm, denoted by the acquiring firm (AF), seeks to purchase a division of another firm, denoted by the target firm (TF), with cash offers; and the TF needs to enhance the productivity by motivating its workers to acquire firm-specific skills. However, since it is costly for workers to invest their effort in firm-specific skills, workers have an incentive to underinvest if they are compensated in advance and are free to quit at their discretion and if their investment level is observable only after their productivity is revealed. This is because workers can take the money and run and can receive a wage attainable elsewhere if their underinvestment is observed after they are compensated. To resolve the opportunism by workers, the TF can rely on deferred compensation that is paid to workers after their productivity is revealed. The contract involving such deferred compensation removes the incentive for workers to shirk even though their investment level is not observable by the TF. The reason is that the deferred compensation acts as a bond tying workers to their investment. Thus, if the TF does not renege on its promise by reason of reputation considerations or so on, the contract involving the deferred compensation deters the opportunism on the part of workers. Nevertheless, if the TF sells a division to the AF, the workers of the division may be discharged or, if retained, not be paid deferred compensation due because the control of the division has changed hands.1 In this paper, we focus on the case in which the TF commits itself to upholding an initial contract, whereas the AF does not.2 We will then find a mechanism that can implement the first-best level of investment even under the possibility of a divestiture and acquisition. Now, if workers rationally expect that their initial contract will be breached after their division is divested, they may have an incentive to shirk on their investment. Thus, the TF additionally needs to compensate workers for the potential cost arising from the possibility of a divestiture. The need for additional compensation is likely to induce the TF to choose a contract that leads to the lower level of investment. Then, the possibility of a divestiture causes an inefficient level of investment through a threat of the transfer of the control of the divested division. To overcome the inefficiency, the TF may use a stock option with a positive exercise price that is awarded workers conditionally on a divestiture. Then, we can show that the conditional stock option can achieve the first-best level of investment even though the initial contract is breached after a divestiture. The intuition behind the result is that the AF can adjust its acquisition tender price so as to compensate the TF for the liability to award the conditional stock option. This implies that, if workers make efficient investment, the burden of additional compensation due to the breach of the initial contract by the AF can be transferred from the TF to the AF through an acquisition tender price that reflects the conditional stock option award. The potential divergence in incentive between the TF and AF is then eliminated. The TF thus has an incentive to compensate workers for the potential cost arising from the breach of the original contract by the AF. The use of conditional stock options has several advantages. For example, the TF may be forced to sell off some divisions to repay its debt or to finance a new project when its cash flow realizations are not high. Even then, the TF can utilize conditional stock option awards to attain the first-best level of investment. We also indicate that any initial contract with stock option plans which are awarded workers nonconditionally is dominated by an initial contract with conditional stock option plans. The intuition behind this result is that the TF must also pay workers stock option benefits even though the division is not divested. This causes nonconditional stock option plans to be costlier to the TF than conditional stock option plans. Until now, we have assumed that the TF does not collude with workers. However, if the initial contract is implicit or if it can be renegotiated after the AF makes no acquisition offer, then the TF may collude with workers and attempt to raise an acquisition tender price up to the level that is consistent with the first-best level of investment even though workers actually choose an inefficient level of investment. Thus, if the AF expects this collusion possibility, it may not make an acquisition offer. Furthermore, the first-best level of investment is not attained. Nevertheless, if the AF is allowed to consider offering its own stock instead of cash, we show that under certain conditions, the AF can overcome this problem. The intuitive reason is that a key difference between the stock and cash offers is due to the feature that the stock value depends on the ex post profitability of the acquisition, while the value of cash does not. Thus, if structured properly, the stock offer can motivate the TF not to collude with workers. In contrast, the value of the cash offer is not contingent on the future cash flows of the divested division. This implies that the TF makes its collusive decision independently of any information on these future cash flows. The cash offer thus cannot deter the TF from colluding with workers. We can now summarize the main results of this paper as follows. (i) The first-best level of firm-specific human capital investment is attained by a stock option plan with a positive exercise price for workers conditional on the event of a divestiture and acquisition even though the possibility of a divestiture and acquisition induces an inefficient level of investment in the absence of such a mechanism. (ii) Under certain conditions, a stock offer in acquisition can resolve a collusion problem in which the TF may collude with workers and attempt to deceive the AF. Our results yield several implications. First, conditional stock options and stock offers in acquisitions serve to foster the formation of firm-specific skills even under expanding M&A opportunities. Furthermore, although an initial contract is breached, this does not imply that workers are not compensated for their investment. Second, the arguments of the breach of implicit contract by Shleifer and Summers (1988) are appropriate to traditional Japanese large firms. However, the recent depression and financial crisis together with the financial deregulation in Japan has been undermining the foundation of the intercorporate shareholding and main bank systems. Since these systems entrench managers to uphold implicit contracts based on trust, there is a wide interest in the subject of whether M&A activities will likely result in the loss of firm-specific human capital. This interest is further strengthened if the efficiency of the Japanese labor system depends upon the acquisition of firm-specific skills by workers and if the increasing global competition will intensify M&A activities in Japanese firms.3 In fact, our model suggests that the adoption of the American style of management—such as stock option plans and stock offers in acquisitions—can resolve the underinvestment problem. This is certainly not the first model to discuss whether the reactions of managers to the transfer of control to other agents have undesirable effects. Shleifer and Summers (1988) informally argue that hostile takeovers undermine implicit contracts with workers and other stakeholders. Schnitzer (1995) formally analyzes how the simultaneous use of poison bills and golden parachutes can solve the underinvestment problem without foregoing profitable takeovers.4 What distinguishes her model from ours is that our model predicts that the first-best allocation can be attained by the use of stock option plans and stock offers in acquisitions. There are also several studies which investigate that the method of payment plays an important role in explaining the stock returns of bidding firms.5 The difference between their results and ours is that in our paper, the benefits of stock offers come out of the possibility that stock offers prevent the TF from colluding with its employees. The paper is organized as follows. Section 2 presents the basic model. Section 3 considers an optimal contract for the basic model and indicates that the possibility of a divestiture and acquisition causes an inefficient level of investment of workers. Section 4 shows that the first-best level of investment can be achieved by a stock option plan with a positive exercise price conditional on the event of a divestiture. Section 5 discusses that a collusion possibility between the TF and its workers can be resolved by a stock offer in acquisition. Section 6 concludes.

We discuss how the efficient level of firm-specific human capital investment is attained even though divestiture and acquisition decisions affect the ability of firms to contract efficiently with workers. We show that the efficient level of investment is achieved by a stock option plan with a positive exercise price for workers conditional on the event of a divestiture. We also suggest that under certain conditions, a stock offer in acquisition can resolve a collusion problem between the target firm and its workers.