This paper presents empirical evidence about the ability of event studies to capture mergers' ex-post profitability as measured by accounting data. We use a sample of large horizontal concentrations during the period 1990-2002 involving 482 firms either as merging firms or competitors, and contrast a measure of the mergers' profitability based on stock market event studies with one based on balance sheet profit data. We show that using a long window around the announcement date (25 or 50 days before the event) increases the ability to capture the ex-post merger effect: the pairwise correlation coefficient is positive and highly significant.
| Identifer | oai:union.ndltd.org:VIENNA/oai:epub.wu-wien.ac.at:3026 |
| Date | 21 January 2010 |
| Creators | Duso, Tomaso, Gugler, Klaus, Yurtoglu, Burcin B. |
| Publisher | Elsevier Inc. |
| Source Sets | Wirtschaftsuniversität Wien |
| Language | English |
| Detected Language | English |
| Type | Article, PeerReviewed |
| Format | application/pdf |
| Relation | http://dx.doi.org/10.1016/j.irle.2010.02.001, http://www.elsevier.com, http://epub.wu.ac.at/3026/ |
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