Is Timing Everything? The Timing of an M&A Announcement in a Merger Wave

Abstract

The authors investigate the pre-merger process, defined as the period between the announcement and completion of an M&A (mergers and acquisitions) deal. Specifically, the authors examine if the timing of the announcement in a merger wave affects whether or not the M&A deal is completed, and how long this pre-merger process takes. The authors conduct a textual analysis of the 150 largest abandoned M&A deals in the sample. From this, the authors find that competing bidders, regulatory concerns, and shareholder opposition from the acquirer are major roadblocks in the pre-merger process, and that these hurdles often occur jointly. Subsequently, the authors examine a sample of 2,802 announced M&As across four industry waves and find that M&A deals initiated earlier in a merger wave are more likely to be completed and are completed more speedily.

Citation

Doan, T.T., Sahib, P.R. and Witteloostuijn, A.v. (2020), "Is Timing Everything? The Timing of an M&A Announcement in a Merger Wave", Finkelstein, S. and Cooper, C.L. (Ed.) Advances in Mergers and Acquisitions (Advances in Mergers and Acquisitions, Vol. 19), Emerald Publishing Limited, Leeds, pp. 1-16. https://doi.org/10.1108/S1479-361X20200000019002