–6.59%
* successful bids only
149
|
1929–1969
|
(0,365)
|
N/A
|
Mergers only.
|
|
Asquith (1983)
|
–7.20%* successful
|
196
|
1962–1976
|
(0,240)
|
N/A
|
Mergers only.
|
|
|
–9.60%* unsuccessful
|
89
|
|
|
|
|
|
Bradley, Desai, Kim (1983)
|
–7.85%* unsuccessful bids only
|
94
|
1962–1980
|
(0,365)
|
N/A
|
Tender offers only.
|
|
Malatesta (1983)
|
–2.90% whole sample –13.70% *after l970
|
121 75
|
1969–1974
|
(0,365)
|
N/A
|
Mergers only. Event date is date of approval.
|
|
|
–7.70% smaller bidders
|
59
|
|
|
|
|
|
Agrawal, Jaffe, Mandelker (1992)
|
–10.26%*
|
765
|
1955–1987
|
(0,1,250)
|
43.97%
|
Mergers only; five-year postmerger performance; tender offer postacquisition performance is not significantly different from zero.
|
|
Loderer, Martin (1992)
|
+1.5%
|
1,298
|
1966–1986
|
(0,1,250)
|
N/A
|
Mergers and tender offers; five-year postacquisition performance.
|
|
Gregory (1997)
|
–12% to –18%*
|
452
|
1984–1992
|
(0,500)
|
31% to 37%
|
Uses six variations of the event study methodology; U.K. mergers and tender offers; two-year postacquisition performance.
|
|
Loughran, Vijh (1997)
|
–14.2% merger +61.3%* tender
|
434 100
|
1970–1989
|
(1,1,250)
|
N/A
|
Five-year postacquisition returns; segment data also available on form of payment.
|
|
|
–0.1% combined
|
|
|
|
|
|
|
Rau, Vermaelen (1998)
|
–4%* mergers +9%* tender offers
|
3,968 348
|
1980–1991
|
(0,36 months)
|
N/A
|
Three-year postacquisition returns, with insights into value and glamour investing strategies.
|
|
Louis (undated)
|
–7.3%* successful –18.4%* unsuccessful
|
1,297 308
|
1981–1998
|
(0,3 years)
|
N/A
|
Comparison of successful and unsuccessful acquirers.
|
|
Pettit (2000)
|
–25.41%*
|
216
|
1977–1993
|
(0,3 years)
|
N/A
|
Tender offers, French sample.
|
|
Ferris and Park (2001)
|
–19.80%*
|
56
|
1990–1993
|
(l,+60 months)
|
N/A
|
Sample of mergers in the telecommunications industry.
|
|
Kohers, Kohers (2001)
|
–37.39%
|
304
|
1984–1995
|
(1,1,250)
|
N/A
|
Sample of technology mergers.
|
|
Moeller, Schlingemann, Stulz (2003)
|
–4.1%
|
12,023
|
1980–2001
|
(0,36 months)
|
N/A
|
|
Unless otherwise noted, event date is announcement date of merger/bid.
*Significant at the 0.95 confidence level or better.
FINDINGS BASED ON THE ANALYSIS OF REPORTED FINANCIAL PERFORMANCE
A second important stream of research on M&A returns is found in 15 studies of profit margins, growth rates, and returns on assets, capital, and equity, summarized in Exhibit 3.8. Scanning the column of results yields the observation that two studies report significantly negative performance postacquisition, four report significantly positive performance, and the rest are in the nonsignificant middle ground. Four studies illuminate interesting aspects of postacquisition performance.
Geoffrey
