Mergers' announcements and their impact on firm value in Athens stock-exchange market: an empirical analysis, 2000–2006

This paper aims to analyse the relation between the returns of companies that participate in mergers as well as the takeover ratios of output-value (Tobin's qs) of each absorbing (henceforth Bidder) and each absorbed (henceforth Target) company for the period 2000–2006. The returns of Targets and Bidders, as well as the returns of the new companies that are created by the mergers (total returns), are bigger when Targets have low Tobin's qs and simultaneously Bidders have high Tobin's qs. This relation is also enhanced by the insertion of control variables. This study does not lie in agreement with the conclusions of Lang et al. as well as of Servaes.