Electronic Resource
Oxford, UK and Boston, USA
:
Blackwell Publishers Ltd
Journal of business finance & accounting
25 (1998), S. 0
ISSN:
1468-5957
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Economics
Notes:
This paper builds on Roll’s hubris hypothesis as to why bidders overpay. It rejects the winner’s curse hypothesis (which implies that the generosity of the merger terms increases the probability of a successful bid) on both theoretical and empirical grounds. The empirical study examines a bargaining theory approach: that the terms offered are determined by the parties’ individual eagerness to merge. It also examines a modification of this: that the terms are dominated by the existence of a premium required by the market irrespective of synergy, thereby also dominating the decision as to whether a bid should be made.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/1468-5957.00202
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