haku: @author Davidson III, W. N. / yhteensä: 4
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| Tekijä: | Davidson III, W. N. Cheng, L. T. W. |
| Otsikko: | Target firm returns: Does the form of payment affect abnormal returns? |
| Lehti: | Journal of Business Finance and Accounting
1997 : APR, VOL. 24:3/4, p. 465-479 |
| Asiasana: | MERGERS MERGERS COMPANIES PAYMENT SYSTEMS |
| Kieli: | eng |
| Tiivistelmä: | Target firm shareholders receive cash earn larger abnormal returns than those receiving stock at the time of a takeover announcement. Cash targets receive larger direct payments from bidders and the size of the target firm abnormal returns is related to the relativesize of this direct payment. When controlling for the size of this payment, the target firm abnormal returns are found to be unrelated to the payment method, so the relationship between payment method and target firm abnormal returns is indirect. This finding casts a doubt on the signaling hypothesis. Cash target firms are driven to demand larger payments from bidding firms by tax implication differences between cash and stock offers. Cash offers do not seem to be valued by the market. |
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