Gains to bidder firms revisited : Domestic and Foreign Acquisitions in Canada
We present large-sample evidence on the performance of domestic and U.S.(foreign) bidder firms acquiring Canadian targets. Domestic bidders earn significantly positive average announcement-period abnormal returns, while U.S. bidder returns are indistinguishable from zero. Measures of pre- and post-a...
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| Published in: | Journal of financial and quantitative analysis 2000, Vol.35 (1), p.1 |
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| Main Authors: | , |
| Format: | Article |
| Language: | eng |
| Online Access: | Get full text |
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| Summary: | We present large-sample evidence on the performance of domestic and U.S.(foreign) bidder firms acquiring Canadian targets. Domestic bidders earn significantly positive average announcement-period abnormal returns, while U.S. bidder returns are indistinguishable from zero. Measures of pre- and post-acquisition abnormal accounting performance are also consistent with a superior domestic bidder performance. Domestic bidder announcement returns are on average greatest for offers involving stock-payment and for the bidders with the smallest equity size relative to the target. Neither direct foreign investment controls, horizontal product-market relationships, nor acquisition propensities explain why domestic bidders outperform their U.S. competitors |
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| ISSN: | 0022-1090 1756-6916 |