Determinants of tender offer post-acquisition financial performance

The present study extends previous research efforts and examines relationships between commonly discussed strategic acquisition factors and long-term financial performance measures of acquiring firms. The factors of interest include relative size, previous acquisition experience, organizational age,...

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Published in:Strategic management journal 1989-07, Vol.10 (4), p.339-350
Main Authors: Fowler, Karen L., Schmidt, Dennis R.
Format: Article
Language:English
Subjects:
Business structures
Corporate mergers
Corporate strategies
Industrial market
Performance metrics
Research studies
Shareholders
Target acquisitions
Target companies
Tender offers
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description The present study extends previous research efforts and examines relationships between commonly discussed strategic acquisition factors and long-term financial performance measures of acquiring firms. The factors of interest include relative size, previous acquisition experience, organizational age, industry commonality, contested versus uncontested acquisitions, and percentage of stock acquired. The financial performance measures include both accounting and capital market data for the 4-year period preceding acquisition activity and the 4-year period following such activity. The study presents bivariate and multivariate analyses for 42 industrial manufacturing firms that engaged in the tender offer form of acquisition. The findings indicate that, on the average, post-acquisition financial performance improved significantly for organizations that had previous acquisition experience, acquired a higher percentage of a target, or were older. Post-acquisition performance decreased significantly for acquiring firms when target firms contested an acquisition.
doi_str_mv 10.1002/smj.4250100404
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ispartof Strategic management journal, 1989-07, Vol.10 (4), p.339-350
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language eng
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source JSTOR Archival Journals and Primary Sources Collection; ABI/INFORM Global; Wiley-Blackwell Journals (Backfile Content)
subjects Business structures
Corporate mergers
Corporate strategies
Industrial market
Performance metrics
Research studies
Shareholders
Target acquisitions
Target companies
Tender offers
title Determinants of tender offer post-acquisition financial performance
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