Corporate control and shareholder wealth in the European power sector, 2000-2007

John García, Francesc Trillas

Research output: Contribution to journalArticleResearchpeer-review

3 Citations (Scopus)

Abstract

This paper analyses how the announcement of changes in corporate control (tender offer) of Endesa, Hidrocantábrico and Scottish Power have affected their stock prices and the impact that these events have on the stock market returns of competitors of the target firm. Using an "event study" methodology we find that takeovers positively and significantly affect, at the 1% level, the stock market return of the target firm. Results are robust across several econometric specifications such as garch and mco models. Also, the results suggest the announcement of a tender offer positively and significantly affects the stock market return of the target firm's competitors.
Original languageEnglish
Pages (from-to)297-319
JournalRevista de Economia Institucional
Volume13
Issue number25
Publication statusPublished - 1 Dec 2011

Keywords

  • Corporate control
  • Event study and value of firms

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