We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Prebid Run-Ups Ahead of Canadian Takeovers: How Big Is the Problem?
- Authors
King, Michael R.
- Abstract
This paper studies the price-volume dynamics ahead of takeover announcements for 399 Canadian firms from 1985 to 2002. I find evidence consistent with insiders trading illegally, creating both abnormal returns (ARs) and abnormal turnover (AT) ahead of the announcement. The rise in AT begins far ahead of the actual announcement, accompanied by ARs in the last five trading days, consistent with more informed trading. Data on disclosed insider trading indicate a sharp increase in volume prior to the takeover announcement, suggesting that insiders make use of private information. This study confirms the importance of AT for triggering an insider trading investigation.
- Subjects
CANADA; MERGERS &; acquisitions; BUSINESS enterprises; RETURNS to scale; BUSINESS turnover; FINANCIAL institutions; STOCKS (Finance); SALE of business enterprises; CORPORATE internal investigations
- Publication
Financial Management (Wiley-Blackwell), 2009, Vol 38, Issue 4, p699
- ISSN
0046-3892
- Publication type
Article
- DOI
10.1111/j.1755-053X.2009.01053.x