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This article discusses ways for entrepreneurs to gain liquidity from their businesses, either with or without a sale of the business. In today's financial arena there is a wide variety of methods and financing vehicles that can enable private companies to harvest liquidity to meet their own needs for growth, the consumption requirements of their founders, or the challenges of tax and estate planning. For companies with limited growth opportunities but fairly stable cash flows, the alternatives range from orderly liquidation to highly leveraged transfers of ownership such as those accomplished by leveraged buyouts, ESOPs, and mezzanine finance. For companies with abundant growth opportunities, value is typically maximized through sale to a strategic buyer or an initial public offering of equity (although a new hybrid called the "private IPO" has recently emerged that looks more like an LBO than an IPO). 2000 Morgan Stanley.

This article reports the findings of the authors' study of the stock market reaction to 345 strategic alliances announced during the period 1983-1992. The study reports statistically significant gains that, when translated into dollars, are divided roughly evenly between the larger and smaller partners (though the smaller partners experience larger percentage gains). Moreover, the value gains are largest in those cases in which two high-tech firms ally to develop or apply new technology, while the market shows less enthusiasm for non-technical or marketing alliances. 1999 Morgan Stanley.