Assessing abnormal returns: the case of Chinese M&A acquiring firms
journal contributionposted on 11.08.2017 by Xiaojing Song, Mark J. Tippett, Andrew Vivian
Any type of content formally published in an academic journal, usually following a peer-review process.
This paper analyzes the economic benefits that accrue to Chinese acquiring firms. Our sample is based on 279 Chinese acquiring firms from 1990 until 2008 and leads to three main findings: i) Chinese acquirers have positive abnormal returns in contrast to western acquirers which tend to earn negative abnormal returns; ii) Chinese takeovers involving alternative modes of consideration have higher abnormal returns than cash deals, again in contrast to western acquirers where cash deals earn higher returns, and iii) The difference in the abnormal returns between alternative and cash deals for Chinese acquirers is driven by highly valued firms.
- Business and Economics