We use short interest as an investor-based measure of over/undervaluation that distinguishes between the misvaluation and Q-theories of mergers. Using this measure, we find that misvaluation is a strong determinant of merger decision making. Firms in the top quintile of short interest are 54%...

This research analyzes 262 cases of tender offer bid (TOB) in which the acquired companies were expected to remain listed after the deals, from among TOB deals conducted between 1990 and 2011, and estimates the value of private benefits of control in Japan based on the premiums paid relative to...

Christian Funke aims at developing a better understanding of a central asset pricing issue: the stock price discovery process in capital markets. Using U.S. capital market data, he investigates the importance of mergers and acquisitions (MA) for stock prices and examines economic links between...

We argue that buyout waves form in response to fluctuations in aggregate discount rates. In our model, discount rates alter the present value of cash flow improvements and the illiquidity premium demanded by buyout investors. We confirm our predictions empirically. Overall deal activity varies...

We argue that buyout waves form in response to fluctuations in aggregate discount rates. In our model, discount rates alter the present value of cash flow improvements and the illiquidity premium demanded by buyout investors. We confirm our predictions empirically. Overall deal activity varies...

Using a hand-collected data set of private firm acquisitions and IPOs, this paper develops the first empirical analysis in the literature of the "IPO valuation premium puzzle," which refers to a situation where many private firms choose to be acquired rather than to go public at higher...

Abstract: Using a unique sample of 425 bank mergers in the US announced between 2000 and 2008 this paper provides clear evidence supporting the collusion and productive efficiency hypotheses. By analyzing 425 bank mergers and a total of 1112 possible rivals, our analysis shows that the majority...