Target Firm - Specific Information and Expected Synergies in

This study investigates the relation between target firm-specific information and expected synergies in M&A. We find that expected synergies increase with pre-acquisition level of target firm specific information. This association is driven mainly by cross-industry acquisitions rather than within-industry acquisitions. Further analysis suggests that while acquirers’ shareholders benefit from target firm-specific information, target shareholder returns from an acquisition decrease with firm-specific information. Finally, we find that the likelihood of an announced acquisition to be withdrawn subsequent to the acquisition announcement decreases with target firm-specific information.