Stock market driven acquisitions
2003; Elsevier BV; Volume: 70; Issue: 3 Linguagem: Inglês
10.1016/s0304-405x(03)00211-3
ISSN1879-2774
AutoresAndrei Shleifer, Robert W. Vishny,
Tópico(s)Financial Reporting and Valuation Research
ResumoWe present a model of mergers and acquisitions based on stock market misvaluations of the combining firms. The key ingredients of the model are the relative valuations of the merging firms and the market's perception of the synergies from the combination. The model explains who acquires whom, the choice of the medium of payment, the valuation consequences of mergers, and merger waves. The model is consistent with available empirical findings about characteristics and returns of merging firms, and yields new predictions as well.
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