Why newly listed firms become acquisition targets

B-Tier
Journal: Journal of Banking & Finance
Year: 2012
Volume: 36
Issue: 9
Pages: 2616-2631

Authors (2)

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

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

Abstract

We study the operating, financial, and ownership structure characteristics of newly listed firms which become acquisition targets shortly after their initial public offerings. We examine whether such firms get acquired because of their successful performance or as an alternative to delisting. We find that firms, which do relatively well in terms of operating as well as stock performance and attract institutional investor interest, draw the attention of acquirers. Furthermore, we observe that investments made by newly listed target firms do not destroy shareholder value and have comparable profitability to investments made by newly listed firms which grow by acquisitions. Overall, firms acquired shortly after listing are on a growth trajectory similar to that of surviving firms.

Technical Details

RePEc Handle
repec:eee:jbfina:v:36:y:2012:i:9:p:2616-2631
Journal Field
Finance
Author Count
2
Added to Database
2026-01-25