Impact of Mergers and Acquisitions on Stock Returns of Tramp Shipping Firms
International Journal of Financial Services Management, Vol. 2, No. 4, pp. 327-343, 2007
21 Pages Posted: 5 Sep 2007 Last revised: 9 Dec 2007
This paper examines a new issue in tramp shipping industry - mergers and acquisitions - which led firms in a competition on size, market share and total tonnage. The purpose of this paper is to investigate the behaviour of tramp shipping firms' stock returns, when they announce mergers and acquisitions and how this is portrayed on their stock values. The methodology used is event study analysis and bootstrap. Our sample is constituted by member firms of NASDAQ and NYSE. The empirical results indicate the positive impact that mergers and acquisitions announcements cause in tramp firms' stock returns. The impact of mergers and acquisitions is highly important and play a key role for firms to follow new challenges in shipping industry and create higher financial value.
Keywords: Corporate restructuring, mergers and acquisitions, tramp shipping firms, stock returns, event study, bootstrap
JEL Classification: G24, G34, G12, G15, L92
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