If uncertainty in the core business drives diversification, then diversification should occur more often when the … target industry has low uncertainty. Adopting an industry-dyad view of diversification, we investigate whether uncertainty … spread, the difference in uncertainty levels between acquirer and target industries, is related to diversification moves …

We investigate the influence of the dependence between random losses on the shortfall and on the diversification …. Furthermore, increasing the dependence between losses decreases the diversification benefit.We also consider merging comonotonic … losses and show that even in this extreme case a strictly positive diversification benefit will often arise …

We document a strong decline in corporate-diversification activity since the late 1970's, and we develop a dynamic …, diversification discount, frequency and returns of diversifying mergers, and frequency of refocusing activity …