Corporate Governance and Acquirer Returns

A-Tier
Journal: Journal of Finance
Year: 2007
Volume: 62
Issue: 4
Pages: 1851-1889

Score contribution per author:

1.341 = (α=2.01 / 3 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We examine whether corporate governance mechanisms, especially the market for corporate control, affect the profitability of firm acquisitions. We find that acquirers with more antitakeover provisions experience significantly lower announcement‐period abnormal stock returns. This supports the hypothesis that managers at firms protected by more antitakeover provisions are less subject to the disciplinary power of the market for corporate control and thus are more likely to indulge in empire‐building acquisitions that destroy shareholder value. We also find that acquirers operating in more competitive industries or separating the positions of CEO and chairman of the board experience higher abnormal announcement returns.

Technical Details

RePEc Handle
repec:bla:jfinan:v:62:y:2007:i:4:p:1851-1889
Journal Field
Finance
Author Count
3
Added to Database
2026-01-25