Abstract
This study examines the effects of announcements of acquisition of assets
on shareholder wealth of buyers over the period January 2000 to December
2002 in the U.K. Significant positive announcement period abnormal returns for
‘fit’ acquisitions of divested assets that disclosed the “sources of funds” are
documented. Multivariate regression analysis shows that announcement period
abnormal returns are significantly related to pre-announcement period abnormal
returns, relative size of the acquisitions and disclosure of sources of funds.
Overall, there is little or no support for the asset fit hypothesis. However, there
is strong support for “Fund Source Disclosure”, “Fund Source Pecking-Order”
and “Relative Size of Acquisition” Hypotheses
on shareholder wealth of buyers over the period January 2000 to December
2002 in the U.K. Significant positive announcement period abnormal returns for
‘fit’ acquisitions of divested assets that disclosed the “sources of funds” are
documented. Multivariate regression analysis shows that announcement period
abnormal returns are significantly related to pre-announcement period abnormal
returns, relative size of the acquisitions and disclosure of sources of funds.
Overall, there is little or no support for the asset fit hypothesis. However, there
is strong support for “Fund Source Disclosure”, “Fund Source Pecking-Order”
and “Relative Size of Acquisition” Hypotheses
| Original language | English |
|---|---|
| Pages (from-to) | 219-240 |
| Number of pages | 22 |
| Journal | Multinational Finance Journal |
| Volume | 12 |
| Issue number | 3-4 |
| DOIs | |
| Publication status | Published - 2008 |