The Post-Merger Performance of Acquiring Firms: A Re-examination of an Anomaly
The existing literature on the post-merger performance of acquiring firms is divided. We re-examine this issue, using a nearly exhaustive sample of mergers between NYSE acquirers and NYSE/AMEX targets. We find that stockholders of acquiring firms suffer a statistically significant loss of about 10%...
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| Veröffentlicht in: | The Journal of finance (New York) 1992-09, Vol.47 (4), p.1605-1621 |
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| container_title | The Journal of finance (New York) |
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| creator | AGRAWAL, ANUP JAFFE, JEFFREY F. MANDELKER, GERSHON N. |
| description | The existing literature on the post-merger performance of acquiring firms is divided. We re-examine this issue, using a nearly exhaustive sample of mergers between NYSE acquirers and NYSE/AMEX targets. We find that stockholders of acquiring firms suffer a statistically significant loss of about 10% over the five-year post-merger period, a result robust to various specifications. Our evidence suggests that neither the firm size effect nor beta estimation problems are the cause of the negative post-merger returns. We examine whether this result is caused by a slow adjustment of the market to the merger event. Our results do not seem consistent with this hypothesis. |
| doi_str_mv | 10.1111/j.1540-6261.1992.tb04674.x |
| format | Article |
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| identifier | ISSN: 0022-1082 |
| ispartof | The Journal of finance (New York), 1992-09, Vol.47 (4), p.1605-1621 |
| issn | 0022-1082 1540-6261 |
| language | eng |
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| source | Periodicals Index Online; Jstor Complete Legacy |
| subjects | Acquisitions & mergers Business structures Efficient markets Financial economics Portfolio performance Return on investment Shareholders Shareholders wealth Shorter Papers Statistical significance Stock exchanges Stock prices Studies Target acquisitions Tender offers Value weighted index |
| title | The Post-Merger Performance of Acquiring Firms: A Re-examination of an Anomaly |
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