Albert H. Choi (University of Virginia Law School) has posted A Rent Extraction Theory of Right of First Refusal on SSRN. Here is the abstract:
Right of first refusal allows the right-holder to purchase a seller’s property by simply matching a third party’s offer. We show that while the right reduces the third party’s profit and creates an inefficiency, it increases the joint profit of the seller and the right-holder. Right of first refusal with a consideration (e.g., a payment from the right-holder to the seller), therefore, allows the seller and the right-holder to extract rent from the third party. This result is independent of whether the third party is aware of the right’s existence.