The Decision to Acquire Listed vs. Unlisted Firms : Determinants and Value Effects in the Spanish Stock Market

We examine the determinants of the decision to acquire a listed vs. an unlisted firm and extend the previous evidence of value creation after controlling for endogeneity due to self–selection bias. We also control for market valuation conditions, finding that results are conditional to them. On the one hand, our results show that investors see unlisted firm acquisitions as a value creation transaction in a bull market period, whereas we find value destruction in the acquisition of listed firms. During the bear market period we do not find value creation in any case. On the other hand, our results suggest that managerial opportunism is a determinant in the acquisition of listed firms, either in bull or bear market periods. However, under information asymmetry, acquirers change their preferences depending on the market conditions