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Market value, market share, and mergers: Evidence from a panel of U.S. firms

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  • Mahdiyeh Entezarkheir
  • Anindya Sen

Abstract

Improving shareholder value has often been cited as a merger determinant. Because mergers create larger firms and less competition, they may increase shareholder value through higher market share and stock†market value. We investigate merger impacts on firms' stock†market value and market share. We construct panel data from 4 different data sources on public merging and non†merging U.S. manufacturing firms for 1980–2003. Instrumental variables and factors such as R&D, patents, and citations control for endogeneity. We find that mergers are positively correlated with stock†market value and market share.

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  • Mahdiyeh Entezarkheir & Anindya Sen, 2018. "Market value, market share, and mergers: Evidence from a panel of U.S. firms," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 39(4), pages 498-511, June.
    • Handle: RePEc:wly:mgtdec:v:39:y:2018:i:4:p:498-511
    DOI: 10.1002/mde.2924
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