Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/270842 
Year of Publication: 
2023
Series/Report no.: 
CFS Working Paper Series No. 701
Publisher: 
Goethe University Frankfurt, Center for Financial Studies (CFS), Frankfurt a. M.
Abstract: 
Speculative news on corporate takeovers may hurt productivity because uncertainty and threat of job loss cause anxiety, distraction, and reduced collaboration and morale among employees and managers. Using a panel of OECD-headquartered firms, we show that firm productivity temporarily declines upon announcements of speculative takeover rumors that do not materialize. This productivity dip is more pronounced for targets and for firms in countries with weaker employee rights and less long-term orientation. Abnormal stock returns mirror these results. The evidence fosters our understanding of potential real effects of speculative financial news and the costs of takeover threats.
Subjects: 
Distraction
Employee commitment
Employee rights
Fear of job loss
Productivity
Shareholder wealth
Takeover speculation
Distraction
JEL: 
D24
G00
G34
J24
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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