|
|
|
|
||||
|
||||
Eat or Be Eaten: A Theory of Mergers and Firm SizeGary B. GortonYale School of Management; National Bureau of Economic Research (NBER) Matthias KahlUniversity of Colorado at Boulder - Leeds School of Business Richard J. RosenFederal Reserve Bank of Chicago - Economic Research January 1, 2009 Abstract: We propose a theory of mergers that combines managerial merger motives with an industry-level regime shift that may lead to value-increasing merger opportunities. Anticipation of these merger opportunities can lead to defensive acquisitions, where managers acquire other firms to avoid losing private benefits if their firms are acquired, or "positioning" acquisitions, where firms position themselves as more attractive takeover targets to earn takeover premia. The identity of acquirers and targets and the profitability of acquisitions depend on the distribution of firm sizes within an industry, among other factors. We find empirical support for some unique predictions of our theory.
Number of Pages in PDF File: 85 Keywords: Mergers, Merger Waves JEL Classification: G34 working papers seriesDate posted: May 4, 2005 ; Last revised: February 25, 2009Suggested CitationContact Information
|
|
|||||||||||||||||||||||||||||||||
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
FAQ
Terms of Use
Privacy Policy
Copyright
This page was processed by apollo2 in 0.547 seconds
