Antonios Antoniou
Merger momentum and market valuations: the UK evidence
Antoniou, Antonios; Guo, Michael (Jie); Petmezas, Dimitris
Authors
Contributors
Professor Dimitris Petmezas dimitris.petmezas@durham.ac.uk
Other
D Petmezas dbr0dp@durham.ac.uk
Other
Abstract
This study examines the effect of merger momentum on acquirer's returns both in the short and long-run. The focus is on high valuation markets and the source of momentum is investigated employing three different hypotheses: the neoclassical hypothesis, the hubris hypothesis and the investor sentiment theory. Evidence is provided that supports the investor sentiment (optimism) hypothesis since it is demonstrated that investors earn significant gains in the short run but returns are reversed in the long-run as initial expectations may not be fully met when combined firms' accomplishments become known over time. The results are robust after controlling for several acquirer and deal characteristics.
Citation
Antoniou, A., Guo, M. (., & Petmezas, D. (2008). Merger momentum and market valuations: the UK evidence. Applied financial economics, 18(17), 1411-1423. https://doi.org/10.1080/09603100701720468
Journal Article Type | Article |
---|---|
Publication Date | Jan 1, 2008 |
Deposit Date | May 22, 2009 |
Journal | Applied Financial Economics |
Print ISSN | 0960-3107 |
Electronic ISSN | 1466-4305 |
Publisher | Routledge |
Peer Reviewed | Peer Reviewed |
Volume | 18 |
Issue | 17 |
Pages | 1411-1423 |
DOI | https://doi.org/10.1080/09603100701720468 |
Public URL | https://durham-repository.worktribe.com/output/1535775 |
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