Acquisition premium

Di Bian

Chapter 10 in Elgar Encyclopedia of Mergers and Acquisitions, 2026, pp 23-27 from Edward Elgar Publishing

Abstract: This chapter examines acquisition premiums, the additional price acquirers pay above a target firm's market value. It delves into economic, behavioural, negotiation, and governance factors influencing premiums while addressing risks of overpayment, such as through managerial overconfidence or competitive tension. The chapter also highlights the strategic role of premiums in securing deals, particularly for R&D-intensive or cross-border targets, with potential benefits if synergies are realised.

Keywords: Acquisition premium; Behavioural biases; Negotiation dynamics; Cross-border acquisitions; Corporate governance (search for similar items in EconPapers)
Date: 2026
ISBN: 9781800880856
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