Wharton Research Scholars

Document Type

Thesis or dissertation

Date of this Version

4-2009

Comments

Suggested Citation:
Vish, Viabhav. "Computer Industry Mergers and Acquisitions: Determinants of Short-Term Value Creation." Wharton Research Scholars Journal. University of Pennsylvania. April 2009.

Abstract

We examine cumulative abnormal returns of mergers and acquisitions in the computer industry over a twenty-day event window surrounding merger announcement. Our findings indicate that acquirers, on average, are generally not able to capture statistically significant cumulative abnormal returns over this event window, while targets are able to capture large, positive statistically significant cumulative abnormal returns. We find that the premium paid by acquirers and in turn received by targets possesses explanatory merit with regards to both acquirer and target cumulative abnormal returns. Additionally, our results reveal that when improvement of marketing capabilities is a stated rationale for pursuing a merger, it has statistically significantly explanatory power of target cumulative abnormal returns.

Keywords

mergers, acquisitions, computer

Share

COinS
 

Date Posted: 02 September 2010