Abstract
This article investigates the returns of acquirer companies in the wake of corporate takeovers. The study tests the post-takeover returns of Australian acquirer firms during the period 2001 to 2003, using two alternative benchmark models. We find evidence that acquirer companies outperform the market benchmark in the three years following the takeover. We also find that takeovers improve the share price performance of such companies relative to their pre-takeover history.
Acknowledgements
We would like to thank Roger Tonkin and other members of the Economics Department at Macquarie University for helpful comments on an earlier draft. Any errors remain our responsibility.