Document Type Master's Dissertation Author Hansen, Arne URN etd-03302010-143733 Document Title “Hostile” takeovers an investment performance of acquirers and targets Degree MBA Department Gordon Institute of Business Science Supervisor
Advisor Name Title Dr A Saville Supervisor Keywords
- mergers and acquisitions
Date 2007-04-08 Availability unrestricted Abstract
Mergers and acquisitions (M&A) can be either “hostile” or “friendly” in nature. This study looks at the corresponding long-term investment performance of “hostile” and “friendly” takeovers within the mining sector, pre and post the takeover of targets, with the aim to investigate whether there are statistically significant differences about which the investor community should be aware.
36 months of monthly share price performance, pre and post first formal merger/takeover announcement date, are studied, for each acquirer is compared with the bourse mining index to calculate the percentage time the acquirer outperforms the market (mining index). Research of the major mining stock exchanges of the world – New York, Toronto, Australia, London and Johannesburg – reveals that the investment performances of “hostile” acquiring mining companies, pre first formal announcement date, are statistically significantly greater than post first formal announcement date. No statistically significant difference was found pre and post first announcement date for “friendly” acquiring mining companies. Although clear differences in post first formal announcement date investment performance are noted between “hostile” acquirers and “friendly” acquirers, there is no statistically significant difference between the investment performances of “friendly” versus “hostile” acquirers.
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Please cite as follows:
Hansen, A 2006, ”Hostile” takeovers and investment performance of acquirers and targets, MBA dissertation, University of Pretoria, Pretoria, viewed yymmdd < http://upetd.up.ac.za/thesis/available/etd-03302010-143733/ >
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