Corporate takeover and shareholders’ wealth in hong kong

Stephen Y L Cheung; Chi Kuen Shum

doi:10.1006/bare.1993.1022

Corporate takeover and shareholders’ wealth in hong kong

Stephen Y L Cheung^*, Chi Kuen Shum

^*Corresponding author for this work

Research output: Contribution to journal › Journal article › peer-review

9 Citations (Scopus)

Abstract

In this study, we examined the effect of a corporate takeover on the shareholders’ wealth in the Hong Kong equity market between 1986-1991. The regulatory framework for takeovers in Hong Kong is different from the UK. Under this regulatory framework, we find that the shareholders of target firms obtain large positive abnormal returns around the announcement day. In contrast, there are no significant abnormal returns for the shareholders of bidding firms. Finally, excess trading volume of target firms occurs before the event day. These results indicate that the takeover event is anticipated.

Original language	English
Pages (from-to)	213-226
Number of pages	14
Journal	British Accounting Review
Volume	25
Issue number	3
DOIs	https://doi.org/10.1006/bare.1993.1022
Publication status	Published - Sept 1993

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Accounting

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10.1006/bare.1993.1022

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title = "Corporate takeover and shareholders{\textquoteright} wealth in hong kong",

abstract = "In this study, we examined the effect of a corporate takeover on the shareholders{\textquoteright} wealth in the Hong Kong equity market between 1986-1991. The regulatory framework for takeovers in Hong Kong is different from the UK. Under this regulatory framework, we find that the shareholders of target firms obtain large positive abnormal returns around the announcement day. In contrast, there are no significant abnormal returns for the shareholders of bidding firms. Finally, excess trading volume of target firms occurs before the event day. These results indicate that the takeover event is anticipated.",

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AB - In this study, we examined the effect of a corporate takeover on the shareholders’ wealth in the Hong Kong equity market between 1986-1991. The regulatory framework for takeovers in Hong Kong is different from the UK. Under this regulatory framework, we find that the shareholders of target firms obtain large positive abnormal returns around the announcement day. In contrast, there are no significant abnormal returns for the shareholders of bidding firms. Finally, excess trading volume of target firms occurs before the event day. These results indicate that the takeover event is anticipated.

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Corporate takeover and shareholders’ wealth in hong kong

Abstract

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