Could the Opening of HSR Reduce the M&A Premium?

Xuan Yang, Qiusheng Zhang, Xiaotian Shen, Jie Qin, Qian Sun and Yuanze Xu
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Xuan Yang: School of Economics and Management, Beijing Jiaotong University, Beijing 100044, China
Qiusheng Zhang: School of Economics and Management, Beijing Jiaotong University, Beijing 100044, China
Xiaotian Shen: School of Economics and Management, Beijing Jiaotong University, Beijing 100044, China
Jie Qin: School of Business, Renmin University of China, Beijing 100872, China
Qian Sun: School of Economics and Management, Beijing Jiaotong University, Beijing 100044, China
Yuanze Xu: School of Economics and Management, Beijing Jiaotong University, Beijing 100044, China

Sustainability, 2022, vol. 14, issue 10, 1-28

Abstract: This study takes the merger and acquisition (M&A) events completed by A-share listed companies in Shanghai and Shenzhen stock markets from 2006 to 2019 as the research samples and uses the dual difference method to test the impact of a “high-speed railway (HSR) opening”, a quasi-natural experimental event, on M&A premium. The results show that the opening of an HSR can significantly inhibit the M&A premium of listed companies in corresponding prefecture-level administrative regions. The results of the mechanism test show that an HSR opening affects M&A premium through two channels: “reducing information asymmetry” and “alleviating agency problems”. This study discusses the impact of an HSR opening on M&A, which helps to provide new empirical evidence for the economic consequences of an HSR opening from the micro level and provides a new perspective for research on the factors affecting M&A premium.

Keywords: HSR; M&A premium; transaction cost (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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