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|Title:||It's the market power, stupid! Stock return patterns in international bank M&A |
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.|
|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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