Value creation in European M&As
AbstractThis paper looks at the value generated to shareholders by the announcement of mergers and acquisitions involving firms in the European Union. Target firm shareholders receive on average a statistically significant excess return of 9%. Acquirers' excess returns are null on average. Excess returns differ significantly depending on whether the merger involves two firms from the same European country or is a cross-border transaction. Cross-border transactions generate less total value than national mergers. Furthermore, when a cross-border merger occurs in an industry in which governments historically have been actively involved, the transaction results in a net destruction of value to shareholders.
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Bibliographic InfoPaper provided by IESE Business School in its series IESE Research Papers with number D/471.
Length: 31 pages
Date of creation: 10 Oct 2002
Date of revision:
Cross-border mergers; shareholder returns; value creation; regulation;
Find related papers by JEL classification:
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
- M10 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - General
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