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Interstate migration‐based social networks and M&A decisions

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  • Suin Lee
  • Christos Pantzalis
  • Jung Chul Park

Abstract

Acquisition decisions and outcomes are found to be associated with the availability of interstate migration‐based social networks. The likelihood of bidders pursuing targets headquartered in migration sending states increases with these social networks’ size, in particular when (a) targets are in the same industry, (b) migration networks span distant states, and (c) targets are small. We also find smaller takeover premia and higher acquirer announcement returns in interstate transactions involving large migration networks. Our collective evidence is consistent with the notion that both enhanced expected synergies and information advantages may drive acquirers’ propensity to choose targets from migration sending states.

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  • Suin Lee & Christos Pantzalis & Jung Chul Park, 2024. "Interstate migration‐based social networks and M&A decisions," The Financial Review, Eastern Finance Association, vol. 59(1), pages 113-153, February.
    • Handle: RePEc:bla:finrev:v:59:y:2024:i:1:p:113-153
    DOI: 10.1111/fire.12349
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