Do managers keep their word? The disclosure of merger intention at pre-merger issuance and M&A performance

Guo, Jie (Michael), Li, Lu, Hu, Nan and Wang, Xing (2019) Do managers keep their word? The disclosure of merger intention at pre-merger issuance and M&A performance. Finance Research Letters, 28. pp. 20-31. ISSN 1544-6123

[img] PDF - Published Version
Restricted to SRO admin only
Available under License All Rights Reserved.

Download (227kB)

Abstract

This paper investigates whether disclosing merger intention at the announcement of equity/debt issuance has an impact on subsequent M&A transactions. We find that companies tend to issue higher proceeds when they reveal their merger intentions, and, subsequently, they are more likely to complete the merger deal itself and pay a higher bid premium. However, we did not find a significant difference in merger performance between firms revealing merger intention and others. Our finding is consistent with the capital need theory.

Item Type: Article
Schools and Departments: University of Sussex Business School > Accounting and Finance
SWORD Depositor: Mx Elements Account
Depositing User: Mx Elements Account
Date Deposited: 06 Jan 2022 09:25
Last Modified: 17 Feb 2022 11:10
URI: http://sro.sussex.ac.uk/id/eprint/103708

View download statistics for this item

📧 Request an update