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Capital Market Evidence of Windfalls From the Acquisition of Tax Carryovers

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  • Plummer, Elizabeth R.
  • Robinson, John R.

Abstract

Examines the relation between tax carryovers for acquired corporations and their excess stock returns at the time of announcement of a pending acquisition. Uses a matched pair design and limits the sample to taxable acquisitions which may qualify for a step up in tax basis.

Suggested Citation

  • Plummer, Elizabeth R. & Robinson, John R., 1990. "Capital Market Evidence of Windfalls From the Acquisition of Tax Carryovers," National Tax Journal, National Tax Association;National Tax Journal, vol. 43(4), pages 481-489, December.
    • Handle: RePEc:ntj:journl:v:43:y:1990:i:4:p:481-89
    DOI: 10.1086/NTJ41788867
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    References listed on IDEAS

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    1. Carleton, Willard T, et al, 1983. "An Empirical Analysis of the Role of the Medium of Exchange in Mergers," Journal of Finance, American Finance Association, vol. 38(3), pages 813-826, June.
    2. Bruner, Robert F., 1988. "The Use of Excess Cash and Debt Capacity as a Motive for Merger," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 23(2), pages 199-217, June.
    3. Asquith, Paul, 1983. "Merger bids, uncertainty, and stockholder returns," Journal of Financial Economics, Elsevier, vol. 11(1-4), pages 51-83, April.
    4. Palepu, Krishna G., 1986. "Predicting takeover targets : A methodological and empirical analysis," Journal of Accounting and Economics, Elsevier, vol. 8(1), pages 3-35, March.
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    Cited by:

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    4. Holcomb, Alex & Mason, Paul & Zhang, Harold H., 2020. "Investment income taxes and private equity acquisition activity," Journal of Empirical Finance, Elsevier, vol. 59(C), pages 25-51.

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