In this paper, I begin by describing and assessing the different criteria simple criteria used by financial economists to evaluate merger success. I then discuss the empirical evidence on mergers and acquisitions in the corporate finance literature beginning with stock return studies, moving to accounting-based studies, and finishing with some discussion of clinical studies. Next, I discuss wha...

Mergers and acquisitions can play a transformative role in the evolution of firms and industries and have become an important feature of the US economy, representing about 5% of GDP and 80% of total capital reallocation among large US firms. In this paper, I develop a search-theoretic model of mergers and acquisitions in a dynamic general equilibrium setting and assess the implications for aggr...

Understanding the fundamental mechanisms behind the complex landscape of corporate mergers and acquisitions is of crucial importance to economies across the world. Adapting ideas from the fields of complexity and evolutionary dynamics to analyse business ecosystems, we show here that ancestry, i.e. the cumulative sum of historical mergers across all ancestors, is the key characteristic to compa...

This paper studies the relation between the premiums in takeover bids involving exchange-listed target firms from 1975-91 and the pre-announcement stock price runups. The evidence shows that the pre-bid runup and the postannouncement increase in the target’s stock price (the Amarkup@) are generally uncorrelated. With little substitution between the runup and the markup, the runup is an added co...

Most mergers and acquisitions involve at least four parties with competing interests — acquiring firm shareholders, acquiring firm management, target firm shareholders, and target firm management. We consider the choice between hostile and friendly takeovers in this context and offer an explanation for the prevalence of friendly mergers between large acquirers and small targets. Negotiated merg...

Strategic business partner: Rhetoric or reality? The role of human resources in mergers and acquisitions The role of Human Resources in Merger and Acquisition transactions can have a critical impact on deal outcomes. However, although current rhetoric acknowledges the importance of Human Resources in M&A transactions, insuffi cient evidence exists to suggest that Human Resources directly infl u...

Competition and antitrust law aims to prevent companies from engaging in anti-competitive behavior and to promote and protect market competition. In this context, mergers and acquisitions are under particular scrutiny, since they are often assumed to be motivated by possible market power increases, thus adversely affecting market efficiency. With a view to recent efforts within the European Uni...

Using a unique Norwegian dataset, which combines information on companies’ bank accounts, annual accounts, bankruptcies, and bank mergers and acquisitions (M&As), we find that such M&As increase interest rate margins for nontransparent small and medium sized firms. There is little effect for more transparent companies. Since, due to information asymmetries, nontransparent firms are typically mo...