Journal of Management Research
Volume 3, Number 1 (April 2003)
ISSN: 0972-5814 Online ISSN: 0974-455X
Cancellation of Mergers and Acquisitions Implications for Target Firms
Timothy L Pett, John D Francis and Robert A Van Ness
| Abstract |
This paper investigates the impact of a cancellation of a merger and acquisitions on the target firm.
Using data from 1982 through 1992, the study examines the returns of sample firms concerning the
announcement of a merger or acquisition cancellation. The results of this study suggest that the
cancellation of an acquisition negatively impacts the market assessment of the firm around the
announcement day. However, the findings suggest that the overall impact of the announcement,
regardless of the cancellation, results in a significantly positive increase in value for the target firm.
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