The role of external regulators in mergers and acquisitions: evidence from SEC comment letters

• 成果类型: Article
• 署名作者: Liu, Tingting; Shu, Tao; Towery, Erin; Wang, Jasmine
• 署名单位: Iowa State University; The Chinese University of Hong Kong, Shenzhen; University System of Georgia; University of Georgia; University of Virginia
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-022-09723-y
• 发表日期: 2024
• 页码: 451-492
• 关键词: CORPORATE DISCLOSURE; MANDATORY DISCLOSURE; INFORMATION; exchange; price; RISK; valuation; takeovers; arbitrage; PRIVATE

摘要

This study examines the role of the Securities and Exchange Commission (SEC) in mergers and acquisitions (M&As) involving publicly traded target firms. We find that deals receiving comment letters have an increased likelihood of deal completion and deal price revision, consistent with the SEC review process reducing information asymmetry, albeit at the cost of delaying the M&A process. Further analyses suggest that the SEC review process generates new value-relevant information via firms' disclosure amendments in response to comment letters. We address endogeneity concerns using multiple approaches. Our findings that the SEC review process reduces information asymmetry in M&As provide new insight into the real economic consequences of disclosure regulation.