Is There Information Leakage Around Business Combinations on the French Market?
EFMA 2002 London Meetings
52 Pages Posted: 14 Mar 2002
Date Written: March 12, 2002
Abstract
This paper studies informed trading around business combinations on the French market to provide evidence of information leakage. We show that the cumulative abnormal returns and the relative spread exhibit variations thirty days before the announcement. Cumulative selling hidden volume increases more for value-destroying rumour-less cases than for cases with rumours. We then examine the determinants of private information. We find that the level of cumulative abnormal volume before the operation is significantly higher for operations between French firms as compared to the one involving at least one foreign firm.
Keywords: Mergers and Acquisitions, hidden order, informed trading, bid-ask spread, information leakage
JEL Classification: G14, G34
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
New Evidence and Perspectives on Mergers
By Gregor Andrade, Mark L. Mitchell, ...
-
Do Managerial Objectives Drive Bad Acquisitions?
By Randall Morck, Andrei Shleifer, ...
-
Stock Market Driven Acquisitions
By Andrei Shleifer and Robert W. Vishny
-
Stock Market Driven Acquisitions
By Andrei Shleifer and Robert W. Vishny
-
Poison or Placebo? Evidence on the Deterrent and Wealth Effects of Modern Antitakeover Measures
By Robert Comment and G. William Schwert
-
Does Corporate Performance Improve after Mergers?
By Paul M. Healy, Krishna Palepu, ...
-
Managerial Performance, Tobin's Q, and the Gains from Successful Tender Offers
By Larry H.p. Lang, Ralph A. Walkling, ...