Abstract
We extend the traditional partnership dissolution models by considering the possibility that partners may only desire a fraction of a partnership (such as a block of shares of a company) so that an efficient dissolution entails multiple owners. We find that the problem can be viewed as the composition of a trade element and an auction element, and if one initial ownership structure entails a higher auction elements than abother initial ownership, the former will be more likely to be dissolved efficiently or generate more profit for a broker who is trying to facilitate the dissolution. As a less evenly distributed ownership structure usuallly entails a higher auction element and hence has a better efficiency and profitability property, our results stand in contrast with the traditional view that a equally distributed initial ownership is usually prefered. By extending our result to consider the whether to sell a company with an auction or by engaging in negotiation, we find that the traditional view that auction is always better fails to hold in general and surely fails when the existing number of buyer is large.