What Factors Drive Takeovers in Australia?
Joshua Porter and
Harminder Singh
Additional contact information
Joshua Porter: Planning and Development Officer, Australia
Harminder Singh: Faculty of Business and Law, Deakin University, Australia
International Journal of Business and Economics, 2010, vol. 9, issue 2, 87-103
Abstract:
We examine the relationships between the wealth changes associated with a takeover announcement to distinguish between three major competing motives¡Xsynergy, hubris, and agency. Empirical tests indicate that the synergy motive is the predominant explanation for the majority of takeovers in Australia; however, the evidence is consistent with the simultaneous presence of hubris in value-creating takeovers. The evidence also suggests agency, not hubris, is the primary motivation for the takeovers which result in value destruction.
Keywords: takeovers; synergy; agency (search for similar items in EconPapers)
JEL-codes: G14 G34 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (3)
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Persistent link: https://EconPapers.repec.org/RePEc:ijb:journl:v:9:y:2010:i:2:p:87-103
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