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Investors’ activism and the gains from takeover deals

Author

Listed:
  • Jie (Michael) Guo
  • Krishna Paudyal
  • Vinay Utham
  • Xiaofei Xing

Abstract

We examine whether activists add value to the shareholders of targets and their acquirers. Several findings emerge. First, acquirers of targets that have activists outperform acquirers of other targets in both the short and long term. Second, the premium received by the shareholders of targets is not affected by activism. Third, superior gains achieved by the acquirers of targets with activists are driven by non-cash deals, while the average target benefits more from cash deals.

Suggested Citation

  • Jie (Michael) Guo & Krishna Paudyal & Vinay Utham & Xiaofei Xing, 2020. "Investors’ activism and the gains from takeover deals," The European Journal of Finance, Taylor & Francis Journals, vol. 26(1), pages 64-83, January.
    • Handle: RePEc:taf:eurjfi:v:26:y:2020:i:1:p:64-83
    DOI: 10.1080/1351847X.2019.1680407
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