TY - JOUR
T1 - Do cross border and domestic acquisitions differ? Evidence from the acquisition of UK targets
AU - Gregory, Alan
AU - O'Donohoe, Sheila
PY - 2014/1
Y1 - 2014/1
N2 - We investigate the determinants of short term wealth effects for both public acquiring and target shareholders following the announcement of UK acquisitions over the period 1990-2005. Regardless of their nationality, overall acquirers incur losses, with domestic acquirers' under-performing cross-border acquirers in general. For the latter no differences in returns between regions are found once the differences in corporate governance regimes are controlled for. Instead it is firm characteristics and in particular firm leverage that largely explain acquirers' returns. All targets gain significantly but the higher returns associated with international deals disappear once bid characteristics are controlled for.
AB - We investigate the determinants of short term wealth effects for both public acquiring and target shareholders following the announcement of UK acquisitions over the period 1990-2005. Regardless of their nationality, overall acquirers incur losses, with domestic acquirers' under-performing cross-border acquirers in general. For the latter no differences in returns between regions are found once the differences in corporate governance regimes are controlled for. Instead it is firm characteristics and in particular firm leverage that largely explain acquirers' returns. All targets gain significantly but the higher returns associated with international deals disappear once bid characteristics are controlled for.
KW - Corporate governance regime
KW - Cross border acquirers
KW - Domestic acquirers
KW - Gearing
KW - UK targets
UR - http://www.scopus.com/inward/record.url?scp=84887515770&partnerID=8YFLogxK
U2 - 10.1016/j.irfa.2013.09.001
DO - 10.1016/j.irfa.2013.09.001
M3 - Article
AN - SCOPUS:84887515770
SN - 1057-5219
VL - 31
SP - 61
EP - 69
JO - International Review of Financial Analysis
JF - International Review of Financial Analysis
ER -