We examine the links between hot markets and momentum in explaining merger waves using a sample of 881 UK acquisitions from 1985 to 2000. We find evidence of short run positive abnormal returns (or merger momentum) in both hot and cold markets. We find evidence of long run reversal. The post...

We propose and test a new misvaluation approach to mergers and acquisitions (Mamp;As) using a sample of 302 UK bidders and targets 1986-2002. Our model assumes that managers have insider information on book values while investors only have publicly available information. We find that bidders are...

This paper examines the effects of ex-ante misvaluation on merger activities in UK 1985-2002 using a sample of 302 bidders and targets. Adopting the methodology of M/B by Rhodes-Kropf, Robinson, and Viswananthan (2005), we decompose M/B into three components: firm-specific errors, sector-wide...