Santa Clara University

Departmental Research Seminar Series 

The Departmental Research Seminar Series features departmentally hosted research presentations by scholars in LSB and various national and international universities.

The calendar below displays all upcoming Departmental Research seminars.

Use the navigation menu on the left of the page to view calendars particular to each series.

 

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Wednesday
26
February

Departmental Research Series : Finance: Jan Jindral : Menlo College

11:00 AM to 12:30 PM


Learning About Target Firms and Pricing of Acquisitions

Abstract:
We analyze the effects of learning about target firms on acquisition pricing. Newly public firms should be more opaque than established firms with long track records. An acquirer with superior information about a newly public firm can negotiate a favorable takeover price because less-informed potential acquirers have a bidding handicap. Consistent with the effects of learning, acquirer announcement returns decrease and takeover premiums increase with the length of time since the targets’ initial public offerings. Our results provide new insights into the determinants of acquirer announcement returns and the effects of learning on acquisition pricing. Moreover, our results suggest that the reason why acquirer announcement returns in acquisitions of public targets are significantly lower than in acquisitions of private targets is not only the abrupt change in the target’s listing status, but also a more gradual process of learning and diminishing of target valuation uncertainty.
 

Contact
Ramie Fernandez
Tel 408-554-4385
 
 
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