Bank Dependence and Bank Financing in Corporate M&A

Sheng Huang, Ruichang Lu, Anand Srinivasan

科研成果: 期刊稿件期刊论文

2 引用 (Web of Science)

摘要

We examine the valuation impact of bank-financed mergers and acquisitions (M&As) and the loan contracts used to finance M&A transactions, focusing on the difference between bank-dependent acquirers and other acquirers. We find that bank-financed deals have higher acquirer’s cumulative abnormal returns relative to other cash M&A deals, but this certification effect exists only for bank-dependent acquirers. Despite bank-dependent acquirers being more susceptible to hold-up, banks do not impose higher loan pricing or more stringent nonprice terms on them. After completion of the acquisition, bank-dependent acquirers retain the M&A financing banks for a much larger share of their borrowing needs, suggesting the importance of repeat business for lack of hold-up. Our findings highlight the positive aspects of bank dependence and the importance of implicit contracting for the lack of hold-up in lending markets.
源语言英语
页(从-至)2250-2283
页数34
期刊Management Science
68
3
DOI
出版状态已出版 - 3月 2022

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