Information sensitivity of high tech industries: evidence from merger announcements
The uncertain nature of technological innovation and a potential misunderstanding of the complexities of high tech operations can lead to much speculation about the true worth of high tech firms. This valuation uncertainty is expected to heighten the information sensitivity of investors in high tech industries. To examine this prediction, this article investigates factors that influence the impact of high tech merger announcements on intra-industry firm valuations. The results show that investors in industry-related firms are highly sensitive to merger announcements involving high tech targets and that the industry responses are even stronger in takeovers with high information impact factors.
If 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.
Volume (Year): 14 (2004)
Issue (Month): 7 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAFE20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAFE20|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Grossman, Sanford J & Stiglitz, Joseph E, 1976. "Information and Competitive Price Systems," American Economic Review, American Economic Association, vol. 66(2), pages 246-53, May.
- Raghavendra Rau, P. & Vermaelen, Theo, 1998. "Glamour, value and the post-acquisition performance of acquiring firms," Journal of Financial Economics, Elsevier, vol. 49(2), pages 223-253, August.
- Jacklin, Charles J & Bhattacharya, Sudipto, 1988. "Distinguishing Panics and Information-Based Bank Runs: Welfare and Policy Implications," Journal of Political Economy, University of Chicago Press, vol. 96(3), pages 568-92, June.
- Andrei Shleifer & Robert W. Vishny, 2001.
"Stock Market Driven Acquisitions,"
NBER Working Papers
8439, National Bureau of Economic Research, Inc.
- Lang, Larry H. P. & Stulz, ReneM. & Walkling, Ralph A., 1991. "A test of the free cash flow hypothesis*1: The case of bidder returns," Journal of Financial Economics, Elsevier, vol. 29(2), pages 315-335, October.
- Aharony, Joseph & Swary, Itzhak, 1983. "Contagion Effects of Bank Failures: Evidence from Capital Markets," The Journal of Business, University of Chicago Press, vol. 56(3), pages 305-22, July.
- Lehn, Kenneth & Poulsen, Annette, 1989. " Free Cash Flow and Stockholder Gains in Going Private Transactions," Journal of Finance, American Finance Association, vol. 44(3), pages 771-87, July.
- Gay, Gerald D & Timme, Stephen G & Yung, Kenneth, 1991. "Bank Failure and Contagion Effects: Evidence from Hong Kong," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 14(2), pages 155-65, Summer.
- Gayle R. Erwin & James M. Miller, 1998. "The Intra-Industry Effects Of Open Market Share Repurchases: Contagion Or Competitive?," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 21(4), pages 389-406, December.
- Brent W. Ambrose & Drew B. Winters, 1992. "Does an Industry Effect Exist for Leveraged Buyouts?," Financial Management, Financial Management Association, vol. 21(1), Spring.
- Eckel, Catherine & Eckel, Doug & Singal, Vijay, 1997. "Privatization and efficiency: Industry effects of the sale of British Airways," Journal of Financial Economics, Elsevier, vol. 43(2), pages 275-298, February.
- Kee H. Chung & Stephen W. Pruitt, 1994. "A Simple Approximation of Tobin's q," Financial Management, Financial Management Association, vol. 23(3), Fall.
- Song, Moon H. & Walkling, Ralph A., 1993. "The Impact of Managerial Ownership on Acquisition Attempts and Target Shareholder Wealth," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 28(04), pages 439-457, December.
When requesting a correction, please mention this item's handle: RePEc:taf:apfiec:v:14:y:2004:i:7:p:525-536. See general 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: (Michael McNulty)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.