Acquiring growth

• 成果类型: Article
• 署名作者: Levine, Oliver
• 署名单位: University of Wisconsin System; University of Wisconsin Madison
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2017.07.001
• 发表日期: 2017
• 页码: 300-319
• 关键词: Mergers and acquisitions; GROWTH OPTIONS; Intangible capital; Corporate investment

摘要

I develop a model of mergers in which M&A deals are used to reallocate investment opportunities. In equilibrium, acquirers lack internal growth options and seek out projects from targets in the M&A market. The model is able to reconcile many features of the merger data that I document, including the high productivity, investment, and valuation of target firms. Furthermore, in my model, profitability is highly predictive of acquisition, and merger transactions naturally lead to a substantial drop in profitability despite creating value for the acquirer. (C) 2017 Elsevier B.V. All rights reserved.