The JOBS Act and Mergers and Acquisitions
43 Pages Posted: 11 Dec 2019
Date Written: November 22, 2019
We examine how the Jumpstart Our Business Startup Act (JOBS Act) affect mergers and acquisitions. We find that U.S. private targets are valued higher after the JOBS Act relative to public targets acquired by US acquirers. The announcement returns of acquirers who acquired US private targets after the JOBS Act are lower. Consistent with the argument that the JOBS Act affects firms with higher disclosure costs more, we find that the effect is more pronounced for firms with higher disclosure costs.
Keywords: JOBS Act, Private Target, Bargaining Power, IPO, Disclosure Cost
JEL Classification: G30, G32, G38
Suggested Citation: Suggested Citation