Abstract

http://ssrn.com/abstract=1565650
 
 

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Merger Waves Following Industry Deregulation


Alexei V. Ovtchinnikov


HEC Paris - Finance Department

March 5, 2010


Abstract:     
Deregulation is endogenous. It is preceded by poor industry performance and is predictable with performance variables. These results imply that merger activity following deregulation should be systematically related to poor pre-deregulation industry performance. Consistent with this hypothesis, I find that post-deregulation mergers serve a contractionary role. Bidders and targets in post-deregulation mergers are poor performers prior to the merger and operate with significant excess capacity. Consistent with the hypothesis that post-deregulation mergers represent a form of exit, the frequency of cash and bankruptcy mergers is significantly higher following deregulation and the offer premium is significantly lower.

Number of Pages in PDF File: 52

Keywords: G34, G38

JEL Classification: Mergers, Acquisitions, Restructuring, Deregulation

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Date posted: March 7, 2010  

Suggested Citation

Ovtchinnikov, Alexei V., Merger Waves Following Industry Deregulation (March 5, 2010). Available at SSRN: http://ssrn.com/abstract=1565650 or http://dx.doi.org/10.2139/ssrn.1565650

Contact Information

Alexei V. Ovtchinnikov (Contact Author)
HEC Paris (Groupe HEC) - Finance Department ( email )
1 rue de la Liberation
Jouy-en-Josas Cedex, 78351
France

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