Journal article
Sources of Gains in Corporate Mergers: Refined Tests from a Neglected Industry
Journal of financial and quantitative analysis, v 47(1), pp 57-89
01 Feb 2012
Abstract
Our work provides refined tests of the source of merger gains in a neglected industry: utilities. Utilities offer fertile ground for analysis of traditional theories: synergy, collusion, hubris, and anticipation. Utility mergers create wealth for the combined firm, consistent with both the synergy and collusion hypotheses. To distinguish between these hypotheses, we study rival stock returns across dimensions related to collusion: deregulation, geography, and horizontal and withdrawn deals. We also find that the impact of mergers on consumer prices is consistent with synergy rather than collusion. Analysis of industry rivals that become targets also rejects collusion and is consistent with anticipation.
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Details
- Title
- Sources of Gains in Corporate Mergers: Refined Tests from a Neglected Industry
- Creators
- David A. Becher - Drexel UniversityJ. Harold Mulherin - Terry College of BusinessRalph A. Walkling - Drexel University
- Publication Details
- Journal of financial and quantitative analysis, v 47(1), pp 57-89
- Publisher
- Cambridge Univ Press
- Number of pages
- 33
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Web of Science ID
- WOS:000303537900003
- Scopus ID
- 2-s2.0-84859960783
- Other Identifier
- 991019167924004721
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- Web of Science research areas
- Business, Finance
- Economics