The returns to bidding firms in corporate takeovers: splitting up the pie
AbstractIn this paper, we examined the impact of ownership concentration in target firms on the returns to shareholders of bidding firms. In this research, we found that shareholders of bidding earn statistically significant positive abnormal returns surrounding takeover announcements. In addition, we found bidder returns of 4% over the event-window [−20, +20]. We showed that the degree of ownership concentration in target firms – measured by the Herfindahl-concentration index – significantly and positively affects the returns to bidding firms. These findings are consistent with the predictions of Grossman and Hart (1980), Bagnoli and Lipman (1988) and Holmstrom and Nalebuff (1992) takeover models.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Inderscience Enterprises Ltd in its journal Int. J. of Banking, Accounting and Finance.
Volume (Year): 1 (2009)
Issue (Month): 4 ()
Contact details of provider:
Web page: http://www.inderscience.com/browse/index.php?journalID=277
corporate takeovers; free-rider problem; corporate control; ownership structure; large shareholders; event study; shareholder returns; bidding firms.;
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Graham Langley) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.