A re-examination of value-creation through strategic alliances

Uri Ben-Zion (), Koresh Galil (), Mosi Rosenboim () and Hadas Shabtay
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Uri Ben-Zion: Dept. of Economics, Ben-Gurion University of the Negev
Hadas Shabtay: Tel-Aviv University

No 902, Working Papers from Ben-Gurion University of the Negev, Department of Economics

Abstract: This paper uses a sample of 335 firms participating in strategic alliances in order to re-examine the value creation through strategic alliances. We show that the immediate positive response of stock markets to new strategic alliances is followed by negative abnormal returns. Twenty days after announcements, cumulative positive abnormal return is only evident for the firms with the highest stock market’s response to the announcement. We relate the positive abnormal returns reported in previous research to the presence of short-run over-reaction in stock markets and conclude in the market’s ability to identify the more valuable alliances.

Keywords: Strategic alliance; over-reaction; momentum (search for similar items in EconPapers)
JEL-codes: D23 G32 L22 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2009
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Journal Article: A reexamination of value creation through strategic alliances (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:bgu:wpaper:0902

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