Takeovers and Divergence of Investor Opinion

• 成果类型: Article
• 署名作者: Chatterjee, Sris; John, Kose; Yan, An
• 署名单位: New York University; Fordham University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhr109
• 发表日期: 2012
• 页码: 227
• 关键词: short-sale constraints; cross-section; stock returns; Speculative bubbles; acquiring firms; acquisitions; MARKET; liquidity; BEHAVIOR; mergers

摘要

We test several hypotheses on how takeover premium is related to investors' divergence of opinion on a target's equity value. We show that the total takeover premium, the pre-announcement target stock price run-up, and the post-announcement stock price markup are all higher when investors have higher divergence of opinion. We obtain identical results with higher market-level investor sentiment. When divergence of opinion is higher, a firm is less likely to be a takeover target, although takeover synergy in successful takeovers is higher. Our results suggest that takeovers may play a role in explaining high contemporaneous stock prices in the presence of high divergence of investor opinion.