Academic first-hand evidence, accumulated over the last two decades, shows that mergers and acquisitions (M&As) of listed target companies tend to destroy value of acquiring firms more often than they create. Considering that deals involving listed firms are typically subject to extensive publicity and investors scrutiny, it is puzzling that they regularly fail to create shareholder value.
The study examined the characteristics and performance of M&As during a previously unexplored recent period and drew important comparisons with the two decades of the 90s and 00s. The M&A sample comprises of 26,078 U.S. M&A deals announced between 1990 and 2015, out of which 5,694 involve listed target firms.
“To the best of our knowledge this is the first study in at least two-and-a-half decades documenting statistically significant value creation for acquiring shareholders to such extent for a large sample of U.S. public acquisitions,” Professor Nick Travlos, Dr George Alexandridis and Dr Nikolaos Antypas
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