Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/57363
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dc.contributor.authorGropp, Reinten_US
dc.contributor.authorHirsch, Christianen_US
dc.contributor.authorKrahnen, Jan Pieteren_US
dc.date.accessioned2012-04-20T17:09:26Z-
dc.date.available2012-04-20T17:09:26Z-
dc.date.issued2011en_US
dc.identifier.piurn:nbn:de:hebis:30-101925en_US
dc.identifier.urihttp://hdl.handle.net/10419/57363-
dc.description.abstractIn this paper we challenge the view that corporate bonds are always arm's length debt. We analyze the effect of bond ratings on the stock price return to acquirers in M&A transactions, which tend to have significant effects on creditor wealth. We find acquirers abnormal returns to be higher if they are unrated, controlling for a wide variety of other effects identified in the literature. Tracing the difference in returns to distinct managerial decisions, we find that, everything else constant, rated firms increase their leverage in takeover transactions by less than their unrated counterparts. Consistent with a significant role for rating agencies, we find monitoring effects to be strongest when acquirer bonds are rated at the borderline between investment grade and junk. Finally, we are able to empirically exclude a large number of alternative explanations for the empirical regularities that we uncover.en_US
dc.language.isoengen_US
dc.publisher|aGoethe University, Center for Financial Studies (CFS) |cFrankfurt a. M.en_US
dc.relation.ispartofseries|aCFS Working Paper |x2011/10en_US
dc.subject.jelG21en_US
dc.subject.jelG24en_US
dc.subject.jelG32en_US
dc.subject.jelG34en_US
dc.subject.ddc330en_US
dc.subject.keywordAcquisitionsen_US
dc.subject.keywordCredit Ratingsen_US
dc.subject.keywordMergers and Acquisitionsen_US
dc.subject.keywordArm's Length Debten_US
dc.subject.keywordAbnormal Returnsen_US
dc.subject.stwÜbernahmeen_US
dc.subject.stwIndustrieobligationen_US
dc.subject.stwKreditwürdigkeiten_US
dc.subject.stwKapitalstrukturen_US
dc.subject.stwKapitalertragen_US
dc.subject.stwSchätzungen_US
dc.subject.stwUSAen_US
dc.titleIs rated debt arm's length? Evidence from mergers and acquisitionsen_US
dc.typeWorking Paperen_US
dc.identifier.ppn65593698Xen_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
dc.identifier.repecRePEc:zbw:cfswop:201110-

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