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Is the Event Study Methodology Useful for Merger Analysis? A Comparison of Stock Market and Accounting Data

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Author Info
Tomaso Duso (Humboldt University Berlin and WZB, duso@wz-berlin.de)
Klaus Gugler (University of Vienna, klaus.gugler@univie.ac.at)
Burcin Yurtoglu (University of Vienna, burcin.yurtoglu@univie.ac.at)

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Abstract

Using a sample of 167 mergers during the period 1990-2002 involving 544 firms either as merging firms or competitors, we contrast a measure of the merger’s profitability based on event studies with one based on accounting data. We find positive and significant correlations between them when using a long window around the announcement date and, for rivals, in case of anticompetitive mergers.

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Publisher Info
Paper provided by SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich in its series Discussion Papers with number 163.

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Date of creation: Sep 2006
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Handle: RePEc:trf:wpaper:163

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Related research
Keywords: Mergers; Merger Control; Event Studies; Ex-post Evaluation;

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Find related papers by JEL classification:
L4 - Industrial Organization - - Antitrust Issues and Policies
K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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  1. Eckbo, B. Espen, 1983. "Horizontal mergers, collusion, and stockholder wealth," Journal of Financial Economics, Elsevier, vol. 11(1-4), pages 241-273, April. [Downloadable!] (restricted)
  2. Gugler, Klaus & Mueller, Dennis C. & Yurtoglu, B. Burcin & Zulehner, Christine, 2003. "The effects of mergers: an international comparison," International Journal of Industrial Organization, Elsevier, vol. 21(5), pages 625-653, May. [Downloadable!] (restricted)
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This page was last updated on 2009-11-20.


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