EconPapers    
Economics at your fingertips  
 

Long-term effect of the form of payment in Spanish mergers and acquisitions: an event study

Jesús Reglero, Teresa Corzo Santamaría and Rocío Saénz-Diez

Cogent Business & Management, 2024, vol. 11, issue 1, 2374878

Abstract: This paper explores the methods of payments for companies engaged in mergers or acquisitions, focusing on the Spanish market from 2007 to 2019, specifically on transformative transactions. We use a novel approach to build a sample of homogeneous corporate transactions that allows us to measure the performance for the acquirer one year after the announcement. A descriptive analysis, considering seventeen criteria, and an event study performed using the market model, CAPM and the Fama-French and Carhart four factor model, evaluate the acquirer’s performance post-announcement. Statistically significative results indicate that using shares over cash is preferable for acquirers to achieve sustained success. These findings reveal that, despite theoretical advantages of cash, shares as method of payment may lead to better stock market performance, limited financial profile deterioration, and more favorable long-term prospects for shareholders.

Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/23311975.2024.2374878 (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:oabmxx:v:11:y:2024:i:1:p:2374878

Ordering information: This journal article can be ordered from
http://cogentoa.tandfonline.com/journal/OABM20

DOI: 10.1080/23311975.2024.2374878

Access Statistics for this article

Cogent Business & Management is currently edited by Len Tiu Wright and Tahir Nisar

More articles in Cogent Business & Management from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().

 
Page updated 2025-03-20
Handle: RePEc:taf:oabmxx:v:11:y:2024:i:1:p:2374878