Serial acquirers and decreasing returns: Do bidders’ acquisition patterns matter?

Thibaut G. Morillon

The Financial Review, 2021, vol. 56, issue 3, 407-432

Abstract: This paper examines the phenomenon of declining announcement returns of serial acquirers. Using a classification of acquirers based on their patterns of acquisition, I find that decreasing returns occur mostly within “blocks” of acquisitions. This trend is driven by bidders who acquire targets quickly in chunks. In contrast, I find no evidence of any such decline in returns for the most active acquirers in the market of corporate control. I test several theories proposed by the prior literature to explain declining returns and find evidence consistent with temporary overvaluation, agency costs, and bidder learning as likely drivers.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://doi.org/10.1111/fire.12253

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:finrev:v:56:y:2021:i:3:p:407-432

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0732-8516

Access Statistics for this article

The Financial Review is currently edited by Cynthia J. Campbell and Arnold R. Cowan

More articles in The Financial Review from Eastern Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().