Private Benefits in Corporate Control Transactions

This paper presents an analytical framework from which it can be inferred whether sellers or buyers in block transactions value private benefits highest. I am thus able to suggest an answer to the question: Are blocks of shares traded because the buyer has high security benefits, or because the buyer has high private benefits from the control rights that come with the shares? Using voting rights as the vehicle for private benefits, I find that the selling shareholders in block transactions attaches more value to private benefits than the buyers and that toeholds are insignificant for the premium paid.