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- Title
Stock price firm‐specific information on the choice of stock payment in mergers and acquisitions.
- Authors
Ouyang, Wenjing; Szewczyk, Samuel H.; Smith, Tom
- Abstract
Previous studies on the choice of stock payment in M&A mainly focus on managerial private information. This study shows that managers also learn new firm‐specific information from financial markets in making this decision. The acquirer's stock price firm‐specific information increases the stock‐payment‐to‐Q sensitivity. The target's stock price firm‐specific information decreases the stock payment probability. Further analyses on deal and firm characteristics as well as shareholder wealth in stock mergers support the managerial learning argument. Overall, this study highlights a new set of information that affects the form of merger payment in mergers and acquisitions.
- Subjects
MERGERS &; acquisitions; STOCK prices; STOCKHOLDER wealth; MARKET prices; DECISION making in marketing
- Publication
Accounting & Finance, 2019, Vol 59, Issue 2, p1299
- ISSN
0810-5391
- Publication type
Article
- DOI
10.1111/acfi.12270