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Contribution Details
| Type | Master's Thesis |
| Scope | Discipline-based scholarship |
| Title | Value creation at the announcement date of European activist investment campaigns |
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| Institution | University of Zurich |
| Faculty | Faculty of Business, Economics and Informatics |
| Number of Pages | 96 |
| Date | 2020 |
| Abstract Text | This thesis evaluated the effect of activist campaigns on target stock returns around the announcement date of the intervention in Europe. Using a data sample from FactSet comprised of 262 unique events from 2005 to 2018 in an event study, it was demonstrated that statistically significant positive abnormal stock returns in target companies ensued over several of the tested event windows; the broadest of these ranged from 20 days before the announcement to 20 days after the announcement. Following this, the researcher attempted to identify the drivers of potential abnormal returns. Accordingly, the event and target characteristics of 214 of the initial 262 events were tested for their impact upon short-term excess returns. Across three different regression models, it was found that the campaign objectives were the leading driver of abnormal returns, with the intention of a hostile takeover resulting in the highest abnormal returns. In regard to target-specific characteristics, the historical two-year sales growth ratio was found to have a statistically significant negative impact on short-term excess returns. |
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