Economic conditions within the market affect the likelihood of performing a business combination between firms. Indeed, the level of uncertainty during period of crisis plays a relevant role in M&A transactions. This paper is one of the first attempts to investigate the relationship between health crisis and business combinations. The findings show that while the bid premiums computed using the target's share price thirty days before the transaction announcement increase for M&A operations performed during health crises, the cumulative abnormal returns decrease.

Bid premiums and cumulative abnormal returns: An empirical investigation on the consequences of the Covid-19 pandemic / Sveva Magnanelli, Barbara; Nasta, Luigi; Ramazio, Emanuele. - In: FINANCE RESEARCH LETTERS. - ISSN 1544-6123. - 49:(2022), pp. 1-9. [10.1016/j.frl.2022.103093]

Bid premiums and cumulative abnormal returns: An empirical investigation on the consequences of the Covid-19 pandemic

Luigi Nasta;
2022

Abstract

Economic conditions within the market affect the likelihood of performing a business combination between firms. Indeed, the level of uncertainty during period of crisis plays a relevant role in M&A transactions. This paper is one of the first attempts to investigate the relationship between health crisis and business combinations. The findings show that while the bid premiums computed using the target's share price thirty days before the transaction announcement increase for M&A operations performed during health crises, the cumulative abnormal returns decrease.
2022
Bid premiums, CARs, Covid-19, M&A transactions
Bid premiums and cumulative abnormal returns: An empirical investigation on the consequences of the Covid-19 pandemic / Sveva Magnanelli, Barbara; Nasta, Luigi; Ramazio, Emanuele. - In: FINANCE RESEARCH LETTERS. - ISSN 1544-6123. - 49:(2022), pp. 1-9. [10.1016/j.frl.2022.103093]
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11385/226058
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