Foreign acquisitions by UK limited companies: short- and long-run performance

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Foreign acquisitions by UK limited companies: short- and long-run performance

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dc.contributor.author Gregory, Alan en_GB
dc.contributor.author McCorriston, Steve en_GB
dc.contributor.department University of Exeter en_GB
dc.date.accessioned 2008-07-25T13:38:10Z en_GB
dc.date.accessioned 2011-01-25T10:28:11Z en_US
dc.date.accessioned 2013-03-20T11:08:42Z
dc.date.issued 2005 en_GB
dc.description.abstract In this paper, we consider the short- and long-run performance of UK firms following foreign acquisitions. Based on a near-exhaustive sample of significant foreign acquisitions by UK companies over the period 1985–1994, we show that short-run returns are insignificantly different from zero irrespective of the location of the acquisition. Further analysis reveals that the distribution of the event period returns is determined by changes in the exchange rate, the presence of the acquiring firm in the target country and by US tax reforms. While long-run returns are not significantly different from zero on average, they show considerable variation by region. Specifically, firms under-perform following acquisition in the US, show insignificant returns following acquisitions in the EU and acquisitions elsewhere show significant positive returns. Examination of the distribution of these returns suggest that, in accordance with the ownership–location–internalisation hypothesis of foreign direct investment (FDI), long-run performance is more likely to depend on the firm-specific advantages such as R&D. en_GB
dc.identifier.citation Journal of Empirical Finance, 12, 99-125 en_GB
dc.identifier.doi 10.1016/j.jempfin.2003.10.003 en_GB
dc.identifier.uri http://hdl.handle.net/10036/33234 en_GB
dc.language.iso en en_GB
dc.publisher Elsevier en_GB
dc.relation.ispartofseries Xfi working papers en_GB
dc.relation.ispartofseries 04/01 en_GB
dc.relation.url http://www.sciencedirect.com/science/journal/09275398 en_GB
dc.relation.url http://xfi.ex.ac.uk/workingpapers/0401.pdf en_GB
dc.subject Foreign acquisitions en_GB
dc.subject Long-run performance en_GB
dc.title Foreign acquisitions by UK limited companies: short- and long-run performance en_GB
dc.type Article en_GB
dc.type Working Paper en_GB
dc.date.available 2008-07-25T13:38:10Z en_GB
dc.date.available 2011-01-25T10:28:11Z en_US
dc.date.available 2013-03-20T11:08:42Z
dc.identifier.issn 09275398 en_GB
dc.description Article; an earlier version was issued as Xfi working paper 04/01 en_GB
dc.identifier.journal Journal of Empirical Finance en_GB


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