The Influence of Payment Methods on Acquiror Stock Price in Mergers and Acquisitions Bachelor

Abstract

This study is examining acquiror CAR on the day of announcement following acquisitions made by Swedish public companies. The study investigates whether the acquiror CAR differs between cash and stock based acquisitions. Furthermore, it is tested to what extent a set of chosen independent variables explain the acquiror CAR. The research questions concerning possible differences in acquiror CAR are tested by a t-test. To examine to what extent the set of chosen independent variables affect acquiror CAR, a set of OLS regressions based on cross-sectional data are conducted. The study finds the result that there is a significant difference in acquiror CAR following acquisitions paid with cash and acquisitions paid with stocks. The study does not find evidence for a difference in acquiror CAR following acquisitions abroad and domestic acquisitions. The study does not find any significant results concerning the extent to which the chosen independent variables affect the acquiror CAR, except for the variable stake, which was found to have a weak impact on acquiror CAR.