Target's organisational form and returns to Australian bidders in cross‐border acquisitions

Colombage, Sisira R. N.; Gunasekarage, Abeyratna; Shams, Syed M. M.

Title: Target's organisational form and returns to Australian bidders in cross‐border acquisitions
Creator: Colombage, Sisira; Gunasekarage, Abeyratna; Shams, Syed
Date: 2014
Type: Text; Journal article
Identifier: http://researchonline.federation.edu.au/vital/access/HandleResolver/1959.17/158709
Identifier: vital:11834
Identifier: https://doi.org/10.1111/acfi.12031
Identifier: ISSN:0810-5391
Abstract: We present large sample evidence on return performances of ustralian acquirers who bid for public and private targets in cross‐border acquisitions. While placing a particular emphasis on the method of payment and the shareholder protection offered by the target country, we analyse the impact of various bid, firm and foreign‐acquisition‐specific characteristics on bidding firms' abnormal returns. We find that ustralian investors perceive cross‐border acquisitions as value‐creating exercises regardless of the organisational form of the target acquired. However, bidders for private targets earn higher return when the method of payment is stock and the targets are located in high investor protection countries. We further find that the abnormal returns are conditional to the relative size of the target, bid frequency, target country destination and the preacquisition financial performance of bidding firms.
Publisher: Wiley and AFAANZ (Accounting and Finance Association of Australia and New Zealand)
Relation: Accounting & Finance Vol. 54, no. 4 (2014), p. 1063-1091
Rights: This metadata is freely available under a CCO license
Subject: Acquirers of private targets; Acquirers of public targets; Economic freedom; Excess return; Foreign acquisitions; Investor protection
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