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Disentangling the link between stock and accounting performance in acquisitions

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  • André Betzer
  • Markus Doumet
  • Marc Goergen

Abstract

We study the accounting and stock performance of 4547 US acquisitions during 1989 and 2008. We categorise acquisitions into four types based on the four possible combinations of positive or negative abnormal stock performance and abnormal accounting performance. First, we compare the bidder, bid and target characteristics across the four types of acquisitions. We find significant differences. Second, with the help of existing theories we explain these differences in bidder, bid and target characteristics by differences in the acquisition motives.

Suggested Citation

  • André Betzer & Markus Doumet & Marc Goergen, 2015. "Disentangling the link between stock and accounting performance in acquisitions," The European Journal of Finance, Taylor & Francis Journals, vol. 21(9), pages 755-771, July.
    • Handle: RePEc:taf:eurjfi:v:21:y:2015:i:9:p:755-771
    DOI: 10.1080/1351847X.2014.890633
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    2. George Marian AEVOAE, 2018. "How Can We Create Value From Enterprise Concentrations? A Meta-Analysis Of The Scientific Literature On M&As In The European Union," EURINT, Centre for European Studies, Alexandru Ioan Cuza University, vol. 5, pages 63-87.
    3. Dasilas, Apostolos & Grose, Chris, 2018. "The wealth effects of public-to-private LBOs: Evidence from Europe," International Review of Financial Analysis, Elsevier, vol. 58(C), pages 179-194.

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    More about this item

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G3 - Financial Economics - - Corporate Finance and Governance
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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