Are the busiest really the best? Further evidence from frequent acquirers
AbstractWe reexamine the announcement returns for a sample of 4215 U.S. frequent acquirers making 3299 domestic and 916 cross-border acquisitions of public, private and/or subsidiary targets between 1999 and 2010. We find that the market has a much stronger reaction to fifth or higher bids and that acquisitions made during the speculative bubble enjoyed higher returns than those made after the Nasdaq closed at its all-time high. Our cross-sectional analysis also shows a strong negative cross-border effect over the entire period of our sample suggesting. This suggests that better targets were domestic rather than foreign, which may reflect the fact that profitable foreign opportunities have become costlier after the Internet craze. Further, we find that acquirer returns are lower for countries in which investor protection, external conflict and ethnic tensions risks are high.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Multinational Financial Management.
Volume (Year): 22 (2012)
Issue (Month): 1 ()
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Web page: http://www.elsevier.com/locate/mulfin
Frequent; Acquirers; Announcement;
Find related papers by JEL classification:
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
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