The DOI matches its Crossref record; 36 of the 36 references it cites were found in a registry or an index.
Shareholder Wealth Effects of European Domestic and Cross‐border Takeover Bids
Open accessAbstract
This paper analyses the short‐term wealth effects of large intra‐European takeover bids. We find announcement effects of 9% for the target firms compared to a statistically significant announcement effect of only 0.7% for the bidders. The type of takeover bid has a large impact on the short‐term wealth effects with hostile takeovers triggering substantially larger price reactions than friendly operations. When a UK firm is involved, the abnormal returns are higher than those of bids involving both a Continental European target and bidder. There is strong evidence that the means of payment in an offer has an impact on the share price. A high market‐to‐book ratio of the target leads to a higher bid premium, but triggers a negative price reaction for the bidding firm. We also investigate whether the predominant reason for takeovers is synergies, agency problems or managerial hubris. Our results suggest that synergies are the prime motivation for bids and that targets and bidders share the wealth gains.
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Cites
La Porta, R., Lopez‐de‐Silanes, F., Shleifer, A., & Vishny, R. W. (1998) · Journal of Political Economy · doi:10.1086/250042 · Cited by 18,025
Agency costs of free cash flow, corporate finance, and takeovers
Jensen, M. C. (1996) · Corporate Bankruptcy · doi:10.1017/cbo9780511609435.005 · Cited by 9,306
Management ownership and market valuation
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The Hubris Hypothesis of Corporate Takeovers
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Diversification's effect on firm value
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Risk measurement when shares are subject to infrequent trading
Dimson, E. (1979) · Journal of Financial Economics · doi:10.1016/0304-405x(79)90013-8 · Cited by 2,754
Shleifer, A., & Vishny, R. W. (1989) · Journal of Financial Economics · doi:10.1016/0304-405x(89)90099-8 · Cited by 2,151
Does corporate performance improve after mergers?
Healy, P. M., Palepu, K. G., & Ruback, R. S. (1992) · Journal of Financial Economics · doi:10.1016/0304-405x(92)90002-f · Cited by 1,659
Managerial Decisions and Long‐Term Stock Price Performance
Mitchell, M. L., & Stafford, E. (2000) · The Journal of Business · doi:10.1086/209645 · Cited by 1,572
Exchange Rates and Foreign Direct Investment: An Imperfect Capital Markets Approach
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Metadata
- Authors
- Goergen, M., & Renneboog, L.
- Venue
- European Financial Management
- Publisher
- Wiley
- Published
- 2004-02-20
- Volume
- 10
- Issue
- 1
- Pages
- 9-45
- ISSN
- 1354-7798 (ISSN-L)
- 1468-036X
- OpenAlex
- W3049675738
- Cited by
- 486
- References
- 36
- FWCI
- 88.60
- Type
- journal article
- Language
- en
- Open access
- green
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