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Event Study in the Evaluation of Effects of Mergers and Acquisitions

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  • Perepeczo Agnieszka

    (Financial Management Department Faculty of Economics and Management, University of Szczecin, Mickiewicza 64, 71-101 Szczecin)

Abstract

The paper presents the essence of the methodology of event study used in developed markets to evaluate post-acquisition performance based on the market data. In particular, the paper discusses the issues of abnormal returns and expected return models, presenting also selected examples of post-acquisition performance in developed markets. At the end, the author has addressed the issue of contemporary tendencies in the event study methodology.

Suggested Citation

  • Perepeczo Agnieszka, 2007. "Event Study in the Evaluation of Effects of Mergers and Acquisitions," Folia Oeconomica Stetinensia, Sciendo, vol. 6(1), pages 107-122, January.
    • Handle: RePEc:vrs:foeste:v:6:y:2007:i:1:p:107-122:n:7
    DOI: 10.2478/v10031-007-0007-2
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    References listed on IDEAS

    as
    1. Fama, Eugene F., 1998. "Market efficiency, long-term returns, and behavioral finance," Journal of Financial Economics, Elsevier, vol. 49(3), pages 283-306, September.
    2. Sara B. Moeller & Frederik P. Schlingemann & Rene M. Stulz, 2003. "Do shareholders of acquiring firms gain from acquisitions?," NBER Working Papers 9523, National Bureau of Economic Research, Inc.
    3. Sudi Sudarsanam & Ashraf A. Mahate, 2003. "Glamour Acquirers, Method of Payment and Post‐acquisition Performance: The UK Evidence," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(1‐2), pages 299-342, January.
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    7. Barber, Brad M. & Lyon, John D., 1997. "Detecting long-run abnormal stock returns: The empirical power and specification of test statistics," Journal of Financial Economics, Elsevier, vol. 43(3), pages 341-372, March.
    8. Alan Gregory, 1997. "An Examination of the Long Run Performance of UK Acquiring Firms," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 24(7&8), pages 971-1002.
    9. Robin Limmack, 2003. "Discussion of Glamour Acquirers, Method of Payment and Post‐ acquisition Performance: The UK Evidence," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(1‐2), pages 343-350, January.
    10. Sudi Sudarsanam & Ashraf A. Mahate -super-*, 2003. "Glamour Acquirers, Method of Payment and Post-acquisition Performance: The UK Evidence," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(1-2), pages 299-342.
    11. John D. Lyon & Brad M. Barber & Chih‐Ling Tsai, 1999. "Improved Methods for Tests of Long‐Run Abnormal Stock Returns," Journal of Finance, American Finance Association, vol. 54(1), pages 165-201, February.
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