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dc.contributor.authorBarbopoulos, Leonidas
dc.contributor.authorAndriosopoulos, Dimitris
dc.identifier.citationBarbopoulos , L & Andriosopoulos , D 2017 , ' Relative equity market valuation conditions and acquirers’ gains ' , Review of Quantitative Finance and Accounting , vol. 49 , no. 3 , pp. 855-884 .
dc.identifier.otherPURE: 246929143
dc.identifier.otherPURE UUID: 0a2e54fc-803d-451b-8d76-b3eaaf3fb671
dc.identifier.otherScopus: 84994339660
dc.identifier.otherWOS: 000410259000010
dc.description.abstractWe examine whether the relative equity market valuation conditions (EMVCs) in the countries of merging firms help acquirers’ managers to time the announcements of both domestic and foreign targets. After controlling for several deal- and merging firm-specific features we find that the number of acquisitions and acquirers’ gains are higher during periods of high-EMVCs at home, irrespective of the domicile of the target. We also find that the higher gains of foreign target acquisitions realized during periods of high-EMVCs at home stem from acquiring targets based in the RoW (=World-G7), rather than the G6 (=G7-UK) group of countries. We argue that this is due to the low correlation of EMVCs between the UK (home) and the RoW group of countries. However, these gains disappear or even reverse during the post-announcement period. Moreover, acquisitions of targets domiciled in the RoW (G6) countries yield higher (lower) gains than acquisitions of domestic targets during periods of high-EMVCs at home. This suggests that the relative EMVCs between the merging firms’ countries allow acquirers’ managers to time the market and acquire targets at a discount, particularly in countries in which acquirers’ stocks are likely to be more overvalued than the targets’ stocks.
dc.relation.ispartofReview of Quantitative Finance and Accountingen
dc.rights© The Author(s) 2016. This article is distributed under the terms of the Creative Commons Attribution 4.0 International License (, which permits unrestricted use, distribution, and reproduction in any medium, provided you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made.en
dc.subjectAcquirers’ gainsen
dc.subjectRelative Equity Market Valuation Conditionsen
dc.subjectAbnormal returnsen
dc.subjectPost-merger performanceen
dc.subjectHB Economic Theoryen
dc.subjectHG Financeen
dc.titleRelative equity market valuation conditions and acquirers’ gainsen
dc.typeJournal articleen
dc.description.versionPublisher PDFen
dc.contributor.institutionUniversity of St Andrews. School of Economics and Financeen
dc.contributor.institutionUniversity of St Andrews. Centre for Responsible Banking and Financeen
dc.description.statusPeer revieweden

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