Investigating the valuation effects of reverse takeovers: evidence from Europe

摘要: This study examines a European sample of 222 private firms that opted for going public through reverse takeover transaction during the period 1992–2011. In particular, our investigates whether takeovers announcements are value-increasing transactions, especially in countries follow strong governance structures. Moreover, post-reverse stock price and operating performance is also at epicenter current study. Employing classical event methodology, we document significant wealth gains shareholders involved takeovers. The market reaction stronger when stricter corporate structures prevail where trade. However, short-term seem to revert substantial losses over long-term lending support overreaction phenomenon. We further detect negligible improvement financial new entity raising concerns efficacy such transactions.