Two Essays on Shareholder Returns and the Form of Financing in Mergers and Tender Offers PDF Download
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Author: Hyun Mo Sung
Publisher:
ISBN:
Category : Consolidation and merger of corporations
Languages : en
Pages : 246
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Book Description
The first essay examines the determinants of returns for bidding firms' stocks in mergers and tender offers using cross-sectional micro-firm data. First, we find that potential overpayments to target shareholders are important for explaining cross-sectional differences in bidders' returns upon the announcement of mergers and tender offers. Second, we find that ceteris paribus cash offers are likely to be chosen by relatively cash rich and low growth firms, and stock exchange offers to be chosen by relatively cash poor and high growth firms. The latter finding is consistent with the pecking order hypothesis. The second essay examines the determinants of rates of return for target firms' stocks in mergers and tender offers using cross-sectional micro-firm data. We find that the difference in abnormal returns between cash offers and stock exchange offers cannot be explained by the difference in tax liabilities of target shareholders between cash offers and stock exchange offers. An alternative explanation is that the expectation of future competition in tender offers might be higher than that in mergers, causing higher target abnormal returns in tender offers.
Author: Hyun Mo Sung
Publisher:
ISBN:
Category : Consolidation and merger of corporations
Languages : en
Pages : 246
Get Book Here
Book Description
The first essay examines the determinants of returns for bidding firms' stocks in mergers and tender offers using cross-sectional micro-firm data. First, we find that potential overpayments to target shareholders are important for explaining cross-sectional differences in bidders' returns upon the announcement of mergers and tender offers. Second, we find that ceteris paribus cash offers are likely to be chosen by relatively cash rich and low growth firms, and stock exchange offers to be chosen by relatively cash poor and high growth firms. The latter finding is consistent with the pecking order hypothesis. The second essay examines the determinants of rates of return for target firms' stocks in mergers and tender offers using cross-sectional micro-firm data. We find that the difference in abnormal returns between cash offers and stock exchange offers cannot be explained by the difference in tax liabilities of target shareholders between cash offers and stock exchange offers. An alternative explanation is that the expectation of future competition in tender offers might be higher than that in mergers, causing higher target abnormal returns in tender offers.
Author: H. Kent Baker
Publisher: John Wiley & Sons
ISBN: 1118030354
Category : Business & Economics
Languages : en
Pages : 612
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Book Description
The most up-to-date guide on making the right capital restructuring moves The Art of Capital Restructuring provides a fresh look at the current state of mergers, acquisitions, and corporate restructuring around the world. The dynamic nature of M&As requires an evolving understanding of the field, and this book considers several different forms of physical restructuring such as divestitures as well as financial restructuring, which refers to alterations in the capital structure of the firm. The Art of Capital Restructuring not only explains the financial aspects of these transactions but also examines legal, regulatory, tax, ethical, social, and behavioral considerations. In addition to this timely information, coverage also includes discussion of basic concepts, motives, strategies, and techniques as well as their application to increasingly complex, real-world situations. Emphasizes best practices that lead to M&A success Contains important and relevant research studies based on recent developments in the field Comprised of contributed chapters from both experienced professionals and academics, offering a variety of perspectives and a rich interplay of ideas Skillfully blending theory with practice, this book will put you in a better position to make the right decisions with regard to capital restructuring in today's dynamic business world.
Author: Fenying Xie
Publisher:
ISBN: 9781374711211
Category :
Languages : en
Pages :
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Book Description
This dissertation, "The Effect of Mergers and Tender Offers on Stockholder Returns: the Case of Hong Kong" by Fenying, Xie, 謝奮穎, was obtained from The University of Hong Kong (Pokfulam, Hong Kong) and is being sold pursuant to Creative Commons: Attribution 3.0 Hong Kong License. The content of this dissertation has not been altered in any way. We have altered the formatting in order to facilitate the ease of printing and reading of the dissertation. All rights not granted by the above license are retained by the author. Abstract: Abstract of thesis entitled The Effect of Mergers and Tender Offers on Stockholder Returns: The Case of Hong Kong submitted by XIE Fenying for the degree of Master of Philosophy at the University of Hong Kong in February 2002 Despite the constant growth of corporate takeovers in Hong Kong during the past few years, little research has been carried out on mergers and acquisitions (M&As) in the region. This study explores M&As in the Hong Kong market with particular emphasis on the examination of abnormal returns around merger and tender offer announcements from 1986 to 1998. In addition to qualitative analysis, quantitative analysis with event study and cross-sectional regression techniques is included. Compared with takeovers in other developed equity markets such as the U.S., mergers and tender offers in Hong Kong exhibit some peculiar differences. The market resistance of takeovers is strong and hostile bids are rare. Ownership of most companies is highly concentrated, often within a family group, and it is closely tied with corporate control power. Capital gains in Hong Kong are not taxed. The regulatory framework for takeovers is also different, e.g. the takeover trigger point is relatively high with 35 percent in the examination period. Under this specific market background, it is found that stockholders of target firms benefit from mergers and tender offers, while stockholders of bidding firms lose. Using market model estimation, on announcement day, merger and tender offer targets both earn statistically significant positive abnormal returns of more than 3%; tender offer bidders show a significant negative abnormal return of -2.18%, whilst merger bidders obtain a positive but insignificant abnormal return of 2.15%. The cumulative average abnormal return over the entire event window, i.e. twenty days before to twenty days after the announcement date, is 8.58% for merger targets (Z statistic = 1.57), 13.75% (Z statistic = 4.97) for tender offer targets, 12.95% for total targets (Z statistic = 5.19), -5.78% (Z statistic = -1.01) for merger bidders, -8.12% (Z statistic = -2.20) for tender offer bidders, and -6.84% (Z statistic = -2.22) for total bidders. The results of market-adjusted-return models are similar. Cross-sectional analysis of the effects of various factors on cumulative abnormal returns over day -1 and day 0 is conducted for targets and bidders respectively. The results indicate that the abnormal performances of targets and bidders are independent of firm size and the mode of acquisition (i.e. merger or tender offer). The cumulative abnormal returns of targets display a strong negative association with pure cash payment and a strong positive relation with their bidders' pretakeover toehold investment. However, there is no evidence that method of financing and toehold explain variation in abnormal performance of bidding firms. Vertical acquisitions are positively related to the two-day cumulative abnormal returns at a less significant level for both target and bidding firms. DOI: 10.5353/th_b2975020 Subjects: Tender offers (Securities) - China - Hong Kong Consolidation and merger of corporations - China - Hong Kong Rate of return - China - Hong Kong Stockholders - China - Hong Kong
Author: Robert F. Bruner
Publisher: John Wiley & Sons
ISBN: 1118436393
Category : Business & Economics
Languages : en
Pages : 1056
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Book Description
A comprehensive guide to the world of mergers and acquisitions Why do so many M&A transactions fail? And what drives the success of those deals that are consummated? Robert Bruner explains that M&A can be understood as a response by managers to forces of turbulence in their environment. Despite the material failure rates of mergers and acquisitions, those pulling the trigger on key strategic decisions can make them work if they spend great care and rigor in the development of their M&A deals. By addressing the key factors of M&A success and failure, Applied Mergers and Acquisitions can help readers do this. Written by one of the foremost thinkers and educators in the field, this invaluable resource teaches readers the art and science of M&A valuation, deal negotiation, and bargaining, and provides a framework for considering tradeoffs in an effort to optimize the value of any M&A deal.
Author: Thomas Kirchner
Publisher: John Wiley & Sons
ISBN: 0470508116
Category : Business & Economics
Languages : en
Pages : 371
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Book Description
A detailed look at an important hedge fund strategy Written by a fund manager who invests solely in merger arbitrage, also referred to as risk arbitrage, and other event-driven strategies, Merger Arbitrage is the definitive book on how this alternative hedge fund strategy works. Initial chapters are dedicated to the ins and outs of the strategy–cash mergers versus stock for stock mergers, legal aspects of mergers, and pitfalls of the merger process–while later chapters focus on giving the reader sound advice for integrating merger arbitrage into an investment portfolio. Merger Arbitrage helps readers understand leverage and options, shorting stocks, and legal aspects of merger arbitrage, including seeking appraisal or filing lawsuits for inadequate merger consideration. For those looking to gain an edge in the merger arbitrage arena, this book has everything they need to succeed. Thomas F. Kirchner, CFA (New York, NY), is the founder and portfolio manager of Pennsylvania Avenue Funds (www.pennavefunds.com), which invests in merger arbitrage and other event-driven strategies.
Author: Benjamin Hermalin
Publisher: Elsevier
ISBN: 0444635408
Category : Business & Economics
Languages : en
Pages : 762
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Book Description
The Handbook of the Economics of Corporate Governance, Volume One, covers all issues important to economists. It is organized around fundamental principles, whereas multidisciplinary books on corporate governance often concentrate on specific topics. Specific topics include Relevant Theory and Methods, Organizational Economic Models as They Pertain to Governance, Managerial Career Concerns, Assessment & Monitoring, and Signal Jamming, The Institutions and Practice of Governance, The Law and Economics of Governance, Takeovers, Buyouts, and the Market for Control, Executive Compensation, Dominant Shareholders, and more. Providing excellent overviews and summaries of extant research, this book presents advanced students in graduate programs with details and perspectives that other books overlook. - Concentrates on underlying principles that change little, even as the empirical literature moves on - Helps readers see corporate governance systems as interrelated or even intertwined external (country-level) and internal (firm-level) forces - Reviews the methodological tools of the field (theory and empirical), the most relevant models, and the field's substantive findings, all of which help point the way forward
Author: Donald DePamphilis
Publisher: Academic Press
ISBN: 0128024534
Category : Business & Economics
Languages : en
Pages : 783
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Book Description
Mergers, Acquisitions, and Other Restructuring Activities is unique in that it is the most current, comprehensive, and cutting-edge text on M&A and corporate restructuring available. It is current in that it includes many of the most up-to-date and notable deals (e.g., Facebook's takeover of WhatsApp, the Dell privatization, and Verizon's mega buyout of Vodafone's share of Verizon Wireless), precedent setting judicial decisions (e.g., efforts to overturn defenses at Airgas and Sotheby's), new regulations (e.g., expediting backend mergers), trends (e.g., increasing role of activist investors in takeovers), and new tactics (e.g., two-tiered poison pill) employed in M&As. Most integrative case studies are new for this edition and involve transactions that have been announced or completed since 2013. It is comprehensive in that nearly all aspects of M&As and corporate restructuring are explored. It is cutting edge in that conclusions and insights are anchored by the most recent academic research, with references to more than 200 empirical studies published in leading peer-reviewed journals just since 2012. And the substantially updated content is illustrated with numerous practical exhibits, case studies involving diverse transactions, easy-to-understand numerical examples, and hundreds of discussion questions and practice exercises. The highlights of the new edition are listed here: · New Chapters: Two new chapters: Chapter 9 and 14. Chapter 9 discusses the basics of applying financial modeling methods to firm valuation and assists the reader in understanding the power (and limitations) of models in analyzing real world situation. Chapter 14 illustrates how complex financial models often are used to support the deal structuring process during M&A negotiations. · New Cases: Ninety percent of the nearly forty case studies are new and involve transactions announced or completed during the last three years. These cases represent friendly, hostile, highly leveraged, and cross-border deals in ten different industries, involving public and private firms as well as firms experiencing financial distress. All end of chapter case studies begin with a "Key Objectives" section indicating what the student should learn from the case study and include discussion questions and solutions available in the online instructors' manual. · Latest Research: This edition focuses on the most recent and relevant academic studies, some of which contain surprising insights changing the way we view this subject matter. Recent research has significant implications for academicians, students, M&A practitioners, and government policy makers shedding new light on current developments and trends in the ever-changing mergers and acquisitions market. The market for corporate control and corporate restructuring strategies are constantly changing, reflecting the ongoing globalization of both product and capital markets, accelerating technological change, escalating industry consolidation, changing regulatory practices, and intensifying cross-border competition. While continuing to be relevant, empirical research covering the dynamics of the M&A markets of the 1970s, 1980s, and 1990s may be less germane in explaining current undercurrents and future trends.
Author: John C. Coffee
Publisher: Oxford University Press
ISBN: 0195364554
Category : Business & Economics
Languages : en
Pages : 562
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Book Description
Author: Patrick A. Gaughan
Publisher: John Wiley & Sons
ISBN: 1119380731
Category : Business & Economics
Languages : en
Pages : 819
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Book Description
The essential M&A primer, updated with the latest research and statistics Mergers, Acquisitions, and Corporate Restructurings provides a comprehensive look at the field's growth and development, and places M&As in realistic context amidst changing trends, legislation, and global perspectives. All-inclusive coverage merges expert discussion with extensive graphs, research, and case studies to show how M&As can be used successfully, how each form works, and how they are governed by the laws of major countries. Strategies and motives are carefully analyzed alongside legalities each step of the way, and specific techniques are dissected to provide deep insight into real-world operations. This new seventh edition has been revised to improve clarity and approachability, and features the latest research and data to provide the most accurate assessment of the current M&A landscape. Ancillary materials include PowerPoint slides, a sample syllabus, and a test bank to facilitate training and streamline comprehension. As the global economy slows, merger and acquisition activity is expected to increase. This book provides an M&A primer for business executives and financial managers seeking a deeper understanding of how corporate restructuring can work for their companies. Understand the many forms of M&As, and the laws that govern them Learn the offensive and defensive techniques used during hostile acquisitions Delve into the strategies and motives that inspire M&As Access the latest data, research, and case studies on private equity, ethics, corporate governance, and more From large megadeals to various forms of downsizing, a full range of restructuring practices are currently being used to revitalize and supercharge companies around the world. Mergers, Acquisitions, and Corporate Restructurings is an essential resource for executives needing to quickly get up to date to plan their own company's next moves.
Author:
Publisher:
ISBN:
Category : Dissertations, Academic
Languages : en
Pages : 546
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Book Description
