Duso, Tomaso and Gugler, Klaus and Yurtoglu, Burcin B.
Is the Event Study Methodology Useful for Merger Analysis? A Comparison of Stock Market and Accounting Data.
SFB/TR 15 Discussion Paper No. 163
Using a sample of 167 mergers during the period 1990-2002 involving 544 firms either as merging firms or competitors, we contrast a measure of the merger’s profitability based on event studies with one based on accounting data. We find positive and significant correlations between them when using a long window around the announcement date and, for rivals, in case of anticompetitive mergers.