Consolidation within the Australian real estate investment trust sector: an evaluation of the impact on unitholder returns

Christopher Ratcliffe, Bill Dimovski () and Monica Keneley

Journal of Property Research, 2010, vol. 26, issue 4, 283-307

Abstract: Mergers and acquisitions within the Australian‐real estate investment trusts (A‐REITs) sector have become a noticeable trend in the last decade. Utilising event study methodology, 36 successful A‐REIT mergers and acquisitions between January 1995 and December 2008 were examined. Both target and bidding shareholders experience positive excess returns of 4.27% and 0.54% respectively over the 41 day event window [−20, +20]. Analysis indicates that the cumulative abnormal returns (CARs) for bidding firms are considerably greater than previous research suggests. This study finds higher bidder CARs when scrip or a combination of scrip and cash is used to finance the acquisition. We also find that the relative size or the size of the acquirer have a positive and significant impact on the excess returns of bidding A‐REITs. This suggests that the synergistic benefits from the acquisition are a result of economies of scale and increased market power. There is also some evidence that the relative size and method of payment influence the CARs of target firms during the event window.

Date: 2010
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/09599916.2009.485415 (text/html)
Access to full text is restricted to subscribers.

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:taf:jpropr:v:26:y:2010:i:4:p:283-307

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RJPR20

DOI: 10.1080/09599916.2009.485415

Access Statistics for this article

Journal of Property Research is currently edited by Bryan MacGregor

More articles in Journal of Property Research from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().