Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/57363 
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dc.contributor.authorGropp, Reint E.en
dc.contributor.authorHirsch, Christianen
dc.contributor.authorKrahnen, Jan Pieteren
dc.date.accessioned2012-04-20T17:09:26Z-
dc.date.available2012-04-20T17:09:26Z-
dc.date.issued2011-
dc.identifier.piurn:nbn:de:hebis:30-101925en
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
dc.language.isoengen
dc.publisher|aGoethe University Frankfurt, Center for Financial Studies (CFS) |cFrankfurt a. M.en
dc.relation.ispartofseries|aCFS Working Paper |x2011/10en
dc.subject.jelG21en
dc.subject.jelG24en
dc.subject.jelG32en
dc.subject.jelG34en
dc.subject.ddc330en
dc.subject.keywordAcquisitionsen
dc.subject.keywordCredit Ratingsen
dc.subject.keywordMergers and Acquisitionsen
dc.subject.keywordArm's Length Debten
dc.subject.keywordAbnormal Returnsen
dc.subject.stwÜbernahmeen
dc.subject.stwIndustrieobligationen
dc.subject.stwKreditwürdigkeiten
dc.subject.stwKapitalstrukturen
dc.subject.stwKapitalertragen
dc.subject.stwSchätzungen
dc.subject.stwUSAen
dc.titleIs rated debt arm's length? Evidence from mergers and acquisitions-
dc.typeWorking Paperen
dc.identifier.ppn65593698Xen
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen
dc.identifier.repecRePEc:zbw:cfswop:201110en

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