I examine the market reaction to merger announcements and the long-term post-merger stock price performance of newly merged firms. For a sample of 484 acquiring firms completing mergers between 1993 and 2000, the average value-weighted abnormal announcement date return (market-adjusted) is a statistically significant -1.02%. On average, this reaction is more negative for firms with "good governance." Specifically, a governance index comprised of three governance variables is significantly negative in a multivariate regression of announcement date abnormal returns. Comp is the percentage of CEO salary consisting of equity incentives (including stock options and restricted stock grants), InsideOwn is the percentage of the firm owned by officers and directors, and InstOwn is the percentage of the firm owned by large outside block shareholders. Value-weighted calendar-time portfolios consisting of the full sample of acquirers exhibit significant abnormal returns of 9.12%, 33.84% and 55.8% for the 12, 36 and 60 months following the merger, respectively. This overperformance is limited to the value-weighted portfolios. There is calendar-time evidence of abnormal performance for some subsamples on a risk adjusted basis. However, when compared to a control group, abnormal performance is limited to large glamour acquirers on a 12-month horizon, large cash acquirers on a 36 and 60-month horizon, and small focusing acquirers on a 60-month horizon. Multivariate analysis of long-run returns reveals that use of equity and corporate diversification are associated with lower post-merger performance. With regard to governance and long-run stock returns, there is also evidence that suggests higher levels of incentive compensation for CEOs is associated with more successful merger transactions for long-term investors.

I examine the market reaction to merger announcements and the long-term post-merger stock price performance of newly merged firms. For a sample of 484 acquiring firms completing mergers between 1993 and 2000, the average value-weighted abnormal announcement date return (market-adjusted) is a statistically significant -1.02%. On average, this reaction is more negative for firms with "good governance." Specifically, a governance index comprised of three governance variables is significantly negative in a multivariate regression of announcement date abnormal returns. Comp is the percentage of CEO salary consisting of equity incentives (including stock options and restricted stock grants), InsideOwn is the percentage of the firm owned by officers and directors, and InstOwn is the percentage of the firm owned by large outside block shareholders. Value-weighted calendar-time portfolios consisting of the full sample of acquirers exhibit significant abnormal returns of 9.12%, 33.84% and 55.8% for the 12, 36 and 60 months following the merger, respectively. This overperformance is limited to the value-weighted portfolios. There is calendar-time evidence of abnormal performance for some subsamples on a risk adjusted basis. However, when compared to a control group, abnormal performance is limited to large glamour acquirers on a 12-month horizon, large cash acquirers on a 36 and 60-month horizon, and small focusing acquirers on a 60-month horizon. Multivariate analysis of long-run returns reveals that use of equity and corporate diversification are associated with lower post-merger performance. With regard to governance and long-run stock returns, there is also evidence that suggests higher levels of incentive compensation for CEOs is associated with more successful merger transactions for long-term investors.

This thesis examines the impact of announcements of syndicated loans on the share prices of borrowing firms. I use a sample of 5,465 loan observations reported in the International Financing Review Platinum database to study this impact. Event study methodology is used. My overall results show significantly positive wealth effects on the borrowing firms. However, when I partition my data set into revolving credit agreements, term loans and hybrid loans, I find that the results are driven primarily by revolving credit agreements. I also observe that the size of the event window plays an important role in identifying the wealth effects for the borrowers. A five-day event window (-2, +2) shows share price response to revolving credit announcements to be significantly positive. A three-day event window (-1, +1) reveals that announcements are statistically positive for revolving credit agreements and statistically negative for term loan announcements. My results are consistent with previous studies in this area. I also distinguish between financial press announcements and information provider (IFR) announcements to cater for the potential for reporting bias. I find that both the IFR and financial press announcements are significant for the five-day window, but only the financial press results are significant for the three-day window. My study is unique in that I differentiate the impact of different sources of information on the market reaction to borrower share price. In addition to the examination of the wealth effect, I also use the structure of the loans to examine the uniqueness of bank loans and their ability to provide financial slack. Specifically, I examine whether revolving credit loans or term loans or hybrid loans make bank loans unique and their ability to provide financial slack. I observe that out of the three structures of bank loan, only revolving credit loans allow the borrower to more precisely match the funds acquired with the firm’s investment needs and to market time by borrowing at times when financing costs are attractive. Revolving credit loans are positively valued by the market both initially and over the longer term. Bank loans reduce information asymmetry, but the renegotiation characteristics of revolving credit loans allow borrowers to exploit changes in the interest rate environment, thus providing support for the market timing theory of capital structure. In contrast to puzzling results of previous studies, I present evidence of long-term positive performance following bank loans.

No description available.

Previous studies have suggested that iron PRBs, receiving high concentrations of inorganic constituents in groundwater, may experience passivation because of the accumulation of inorganic precipitates. In an iron PRB containing more highly reactive material, even though the initial contaminant removal rate is faster than for less reactive material, a faster migration of the contaminant removal front may occur due to the greater reactivity loss, caused by faster accumulation of secondary precipitates. In contrast, an iron PRB containing less reactive material may show a slower accumulation of precipitates, and thus will show a slower migration of the contaminant removal front over time. Thus, it is hypothesized that an iron material having moderate initial reactivity may be more advantageous than material having a higher reactivity in terms of long-term performance. The objective of this study was to test this hypothesis by evaluating the changes of the reactivities of different iron materials in the presence of dissolved CaCO₃. <br /><br /> Four different iron materials (Connelly, G-M, Ispat and Peerless) were selected for the column experiments. The changes in reactivities of the iron and formation of secondary precipitates over time were assessed, primarily by the iron corrosion rates, calculated from the hydrogen gas generation rates, by the cis-DCE removal rates and by the alkalinity profiles. The accumulation of precipitates in the four columns caused passivation of the iron. The passivation of the iron in turn resulted in migration of the mineral precipitation fronts as well as profiles of cis-DCE, TCE, VC, alkalinity, Eh, pH, and chloride. Connelly and G-M had longer periods of operation than Ispat and Peerless and thus their performance was the primary test of the hypothesis. G-M iron, which had the higher initial corrosion rate, compared to Connelly, showed a faster accumulation of precipitates near the influent end. The difference in accumulated precipitates resulted in a difference in the leading edge of the organic profiles and a significant difference in the pattern of passivation, indicating a faster passivation in the region near the influent end for G-M. <br /><br /> Model simulations were performed using the same fitting parameters but with different initial corrosion rate constants to further test the hypothesis. The model provided a reasonable representation of changing reactivities of the columns, being consistent with the observed data. In the simulation for long-term prediction, the cases of higher corrosion rates showed earlier breakthroughs and steeper curves than those of lower corrosion rates. Also, the predictions showed greater porosity loss for the case of higher corrosion rate. Thus, long-term predictions support the hypothesis. Accurate determination of model parameters such as cis-DCE degradation rate constants and iron corrosion rates are required for better predictions of long-term performance.

Previous studies have suggested that iron PRBs, receiving high concentrations of inorganic constituents in groundwater, may experience passivation because of the accumulation of inorganic precipitates. In an iron PRB containing more highly reactive material, even though the initial contaminant removal rate is faster than for less reactive material, a faster migration of the contaminant removal front may occur due to the greater reactivity loss, caused by faster accumulation of secondary precipitates. In contrast, an iron PRB containing less reactive material may show a slower accumulation of precipitates, and thus will show a slower migration of the contaminant removal front over time. Thus, it is hypothesized that an iron material having moderate initial reactivity may be more advantageous than material having a higher reactivity in terms of long-term performance. The objective of this study was to test this hypothesis by evaluating the changes of the reactivities of different iron materials in the presence of dissolved CaCO₃. <br /><br /> Four different iron materials (Connelly, G-M, Ispat and Peerless) were selected for the column experiments. The changes in reactivities of the iron and formation of secondary precipitates over time were assessed, primarily by the iron corrosion rates, calculated from the hydrogen gas generation rates, by the cis-DCE removal rates and by the alkalinity profiles. The accumulation of precipitates in the four columns caused passivation of the iron. The passivation of the iron in turn resulted in migration of the mineral precipitation fronts as well as profiles of cis-DCE, TCE, VC, alkalinity, Eh, pH, and chloride. Connelly and G-M had longer periods of operation than Ispat and Peerless and thus their performance was the primary test of the hypothesis. G-M iron, which had the higher initial corrosion rate, compared to Connelly, showed a faster accumulation of precipitates near the influent end. The difference in accumulated precipitates resulted in a difference in the leading edge of the organic profiles and a significant difference in the pattern of passivation, indicating a faster passivation in the region near the influent end for G-M. <br /><br /> Model simulations were performed using the same fitting parameters but with different initial corrosion rate constants to further test the hypothesis. The model provided a reasonable representation of changing reactivities of the columns, being consistent with the observed data. In the simulation for long-term prediction, the cases of higher corrosion rates showed earlier breakthroughs and steeper curves than those of lower corrosion rates. Also, the predictions showed greater porosity loss for the case of higher corrosion rate. Thus, long-term predictions support the hypothesis. Accurate determination of model parameters such as cis-DCE degradation rate constants and iron corrosion rates are required for better predictions of long-term performance.

No description available.

4th International Conference on Advances in Experimental Structural Engineering, Ispra, Lombardy, Italy, June 29-30, 2011

No description available.

This thesis is aimed to empirically investigate the performance impact of frequent acquisitions as an aggressive merger and acquisition (M&A) strategy for an acquiring firm. In literature related to the study of M&A, a common question is whether acquisitions improve the performance of acquirers. Neither theoretical nor empirical studies have a clear view on the performance effect of M&A. Some argue positively and some are opposite. Although existing research are mixed for their arguments, a takeover is commonly perceived as a shock to the firm with a constant effect on changing business performance. This static perception of M&A creates a difficulty in explaining why firms acquire others when the performance effect is negative. To address the issue, this thesis examines the M&A effect dynamically with taking into account the role of merger frequency in affecting performance. On the basis of a large sample that consists of about 14,000 acquisitions from more than 100 countries over last 12 years, the thesis finds that the investors perceive a lower value if the acquiring firm is involved in frequent mergers. This is because more mergers are expected to attract considerable amount of management attention away from profitable activities in order to digest the challenges of new business integration at least in the short run. This “digesting constraint” argument is evident by our estimations. Firm becomes less profitable in the short run after a merger shock, and this adverse effect can be more severe if the firm is involved in more frequent mergers. Evidence of the thesis further show that, the effect of merger shocks is not static and persistent, and it changes with time. The shock affects adversely profitability in the short run, usually lasting a couple of years, and then the negative effect on performance could be turned either oppositely if the firm digests the shock successfully, or otherwise, continuously but diminishing over time if the digestion takes longer such as for frequent acquisition. This finding implies that the pace of firm resilience to a merger shock can be affected by its merger strategies. The pace can be slow if the firm pursues frequent mergers aggressively. The performance effect of a merger shock is dynamic and changes with time. The dynamic view for merger shocks from this study opens a new vision for literature in merger studies. Overall the market expectation to a merger effect on changing firm performance is quite consistently related to what has actually happened to the firm after the merger shock.