Mergers & Acquisitions: Returns in Deals from 2007-2008
Gordon, Dylan T.
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This paper analyzes various three day returns for companies involved in the announcement of a merger or acquisition between January 2007 and December 2008. The study finds that bidders generally have zero or slightly negative returns, while targets have positive returns. Additionally, the study looks at returns based on whether the deal was completed within six months, whether cash or stock was used, and whether the deal involved a competing bid. Similar to full sample results, we find that bidders have zero or slightly negative returns and targets have positive returns.