Cash acquirers are an interesting sub-group of acquirers. Whereas the overall evidence seems to suggest the majority of mergers and acquisitions destroy shareholder value in the long term, cash-financed acquisitions do not appear to do so. Yet this seems at variance with the prediction from...

Using a value-weighted rather than an equally weighted regression, Easton and Sommers (2007) show that the upward bias in the risk premium implied by analysts' earnings forecasts falls to 1.6%, but remains statistically and economically significant. In this paper, we argue that any estimation of...

In this paper, it is argued that previous estimates of the expected cost of equity and the expected arithmetic risk premium in the UK show a degree of upward bias. Given the importance of the risk premium in regulatory cost of capital in the UK, this has important policy implications. There are...

Although Jensen (1988) argues that high levels of free cash flow and unused borrowing capacity are likely to encourage low-value mergers, the “pecking order” theory offers a different perspective, where managers conserve cash flow to undertake positive NPV investments. We argue that the...

In this paper, using corporate social responsibility (CSR) measures constructed from EIRIS data and mapped onto Environment, Employee and Community dimensions, as well as a Composite indicator, we show that all two out of the three dimensions of CSR, together with the Composite measure, are...

Previous work has identified that IPOs underperform a market index, and the purpose of this paper is to examine the robustness of this finding. We re-examine the evidence on the long-term returns of IPOs in the UK using a new data set of firms over the period 1985-92, in which we compare...

In this paper we examine a comprehensive set of 2,567 UK IPOs launched between mid-1975 and the end of 2004. We find compelling evidence of long run under-performance that persists for between 36 and 60 months post-flotation, depending on the precise method chosen to measure abnormal returns....