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http://hdl.handle.net/10419/30170
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| Title: | | It's the market power, stupid! Stock return patterns in international bank M&A  |
| Authors: | | Hankir, Yassin Rauch, Christian Umber, Marc P. |
| Issue Date: | | 2009 |
| Series/Report no.: | | Working paper series // Frankfurt School of Finance & Management 129 |
| Abstract: | | This paper analyzes capital market reactions to international bank M&A. We investigate combined stock return patterns of targets, bidders, and their peers upon takeover announcement, and closing or withdrawal. We distinguish five common M&A hypotheses and relate characteristic and mutually exclusive abnormal stock return patterns to each hypothesis. We find that investors believe in gains through the exploitation of market power by the post-merger entity. In a multinomial logistic model we show that patterns related to market power significantly concur with large relative target size, intra-industry mergers, and increasing market concentration, suggesting a substantial lessening of competition through M&A. |
| Subjects: | | M&A Banks Event Study Peer Returns Market Power |
| JEL: | | G34 G21 G14 L13 |
| Persistent Identifier of the first edition: | | urn:nbn:de:101:1-2009102604 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Frankfurt School - Working Paper Series, Frankfurt School of Finance and Management
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