Acquiring Acquirers

Review of Finance, Vol. 19, pp. 1489-1541, 2015

AFA 2013 San Diego Meetings Paper

58 Pages Posted: 15 Mar 2012 Last revised: 12 Apr 2016

See all articles by Ludovic Phalippou

Ludovic Phalippou

University of Oxford - Said Business School

Fangming Xu

University of Bristol

Huainan Zhao

Loughborough University - School of Business and Economics

Date Written: August 15, 2014

Abstract

Target acquisitiveness stands out as one of the primary drivers of all the key aspects of the market for corporate takeovers: acquisition announcement returns, probability of deal success, propensity to acquire and be acquired. Acquisitive targets, though a small proportion of the sample, are responsible for half of the overall negative acquisition announcement returns. Our large body of empirical evidence consistently supports the view that the motivation behind acquisitions of acquisitive targets is defensive: acquirers ‘eat in order not to be eaten’.

Keywords: Mergers and Acquisitions, Takeovers, Acquirer Announcement Returns

JEL Classification: G34, G30

Suggested Citation

Phalippou, Ludovic and Xu, Fangming and Zhao, Huainan, Acquiring Acquirers (August 15, 2014). Review of Finance, Vol. 19, pp. 1489-1541, 2015, AFA 2013 San Diego Meetings Paper, Available at SSRN: https://ssrn.com/abstract=2021979 or http://dx.doi.org/10.2139/ssrn.2021979

Ludovic Phalippou (Contact Author)

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain

Fangming Xu

University of Bristol ( email )

School of Accounting and Finance
15-19 Tyndalls Park Road
Bristol, BS8 1PQ
United Kingdom
+44(0)1173941503 (Phone)

HOME PAGE: http://https://research-information.bris.ac.uk/en/persons/fangming-xu

Huainan Zhao

Loughborough University - School of Business and Economics ( email )

Epinal Way
Leics LE11 3TU
Leicestershire
United Kingdom

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