Takeover Waves

Triggers, Performance and Motives

M. Martynova, L.D.R. Renneboog

Research output: Working paperDiscussion paperOther research output

934 Downloads (Pure)

Abstract

This paper reviews the vast academic literature on the market for corporate control.Our main focus is the cyclical wave pattern this market exhibits.From the perspective of takeover waves, we address questions such as: Why do mergers and acquisitions (M&As) occur?Does the ensuing transfer of control generate shareholder gains?What are the main profitability drivers in M&As by takeover wave?We find that the pattern of takeover activity and its profitability significantly vary across the various takeover waves.Despite such diversity, all waves have similarities: they are preceded by technological or industrial shocks, and occur in a positive economic and political environment, amidst rapid credit expansion and stock market booms.Takeovers towards the end of each wave are usually driven by non-rational, frequently selfinterested managerial decision-making.
Original languageEnglish
Place of PublicationTilburg
PublisherFinance
Number of pages56
Volume2005-107
Publication statusPublished - 2005

Publication series

NameCentER Discussion Paper
Volume2005-107

Fingerprint

Trigger
Profitability
Economic environment
Mergers and acquisitions
Stock market
Market for corporate control
Managerial decision making
Political environment
Shareholders
Credit

Keywords

  • mergers
  • diversification
  • takeover waves

Cite this

Martynova, M., & Renneboog, L. D. R. (2005). Takeover Waves: Triggers, Performance and Motives. (CentER Discussion Paper; Vol. 2005-107). Tilburg: Finance.
Martynova, M. ; Renneboog, L.D.R. / Takeover Waves : Triggers, Performance and Motives. Tilburg : Finance, 2005. (CentER Discussion Paper).
@techreport{ed13463933ef47209935e906c832aee7,
title = "Takeover Waves: Triggers, Performance and Motives",
abstract = "This paper reviews the vast academic literature on the market for corporate control.Our main focus is the cyclical wave pattern this market exhibits.From the perspective of takeover waves, we address questions such as: Why do mergers and acquisitions (M&As) occur?Does the ensuing transfer of control generate shareholder gains?What are the main profitability drivers in M&As by takeover wave?We find that the pattern of takeover activity and its profitability significantly vary across the various takeover waves.Despite such diversity, all waves have similarities: they are preceded by technological or industrial shocks, and occur in a positive economic and political environment, amidst rapid credit expansion and stock market booms.Takeovers towards the end of each wave are usually driven by non-rational, frequently selfinterested managerial decision-making.",
keywords = "mergers, diversification, takeover waves",
author = "M. Martynova and L.D.R. Renneboog",
note = "Subsequently published in Journal of Banking & Finance, 2008 (rt) Pagination: 56",
year = "2005",
language = "English",
volume = "2005-107",
series = "CentER Discussion Paper",
publisher = "Finance",
type = "WorkingPaper",
institution = "Finance",

}

Martynova, M & Renneboog, LDR 2005 'Takeover Waves: Triggers, Performance and Motives' CentER Discussion Paper, vol. 2005-107, Finance, Tilburg.

Takeover Waves : Triggers, Performance and Motives. / Martynova, M.; Renneboog, L.D.R.

Tilburg : Finance, 2005. (CentER Discussion Paper; Vol. 2005-107).

Research output: Working paperDiscussion paperOther research output

TY - UNPB

T1 - Takeover Waves

T2 - Triggers, Performance and Motives

AU - Martynova, M.

AU - Renneboog, L.D.R.

N1 - Subsequently published in Journal of Banking & Finance, 2008 (rt) Pagination: 56

PY - 2005

Y1 - 2005

N2 - This paper reviews the vast academic literature on the market for corporate control.Our main focus is the cyclical wave pattern this market exhibits.From the perspective of takeover waves, we address questions such as: Why do mergers and acquisitions (M&As) occur?Does the ensuing transfer of control generate shareholder gains?What are the main profitability drivers in M&As by takeover wave?We find that the pattern of takeover activity and its profitability significantly vary across the various takeover waves.Despite such diversity, all waves have similarities: they are preceded by technological or industrial shocks, and occur in a positive economic and political environment, amidst rapid credit expansion and stock market booms.Takeovers towards the end of each wave are usually driven by non-rational, frequently selfinterested managerial decision-making.

AB - This paper reviews the vast academic literature on the market for corporate control.Our main focus is the cyclical wave pattern this market exhibits.From the perspective of takeover waves, we address questions such as: Why do mergers and acquisitions (M&As) occur?Does the ensuing transfer of control generate shareholder gains?What are the main profitability drivers in M&As by takeover wave?We find that the pattern of takeover activity and its profitability significantly vary across the various takeover waves.Despite such diversity, all waves have similarities: they are preceded by technological or industrial shocks, and occur in a positive economic and political environment, amidst rapid credit expansion and stock market booms.Takeovers towards the end of each wave are usually driven by non-rational, frequently selfinterested managerial decision-making.

KW - mergers

KW - diversification

KW - takeover waves

M3 - Discussion paper

VL - 2005-107

T3 - CentER Discussion Paper

BT - Takeover Waves

PB - Finance

CY - Tilburg

ER -

Martynova M, Renneboog LDR. Takeover Waves: Triggers, Performance and Motives. Tilburg: Finance. 2005. (CentER Discussion Paper).