The Long-Run Performance of Mergers and Acquisitions: Evidence from the Canadian Stock Market

Paul Andre, Maher Kooli and Jean-François L’Her

Financial Management, 2004, vol. 33, issue 4

Abstract: We study the long-term performance of 267 Canadian mergers and acquisitions that take place between 1980 and 2000, using different calendar-time approaches with and without overlapping cases. Our results suggest that Canadian acquirers significantly underperform over the three-year post-event period. Further analysis shows that our results are consistent with the extrapolation and the method-of-payment hypotheses; that is, glamour acquirers and equity financed deals underperform. We also find that cross-border deals perform poorly in the long run.

Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:fma:fmanag:andrekoolilher04

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