The authors examine, in a cumulative average abnormal return (CAAR) framework, the effect of four easily identifiable features of merger activity on acquirer/target shareholder wealth. The features considered are the relatedness of the acquiring and target firms involved in the merger, the...

In this paper we consider the effect of various explanatory characteristics on target and acquiring firm shareholder's wealth using a specialized graphical technique. Whereas previous analyses have considered each of the characteristics in isolation we analyse all the characteristics...

In this paper we discuss the change in the beta of an acquiring firm after merger, and examine the unexplained difference between the beta predicted by capital market theory and the beta actually calculated. The analysis is done within two different frameworks, equity beta on the one hand and...

A mathematical model which relates the exchange ratio (the number of acquiring firm's shares Issued for each target share) and the postmerger expected price earnings ratio of firms involved in mergers, is applied to 30 firms involved in recent share-exchange mergers on the Johannesburg Stock...