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| Type | Working Paper |
| Scope | Discipline-based scholarship |
| Title | The Intangibles Song in Takeover Announcements: Good Tempo, Hollow Tune |
| Organization Unit | |
| Authors |
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| Language |
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| Institution | University of Zurich |
| Series Name | Swiss Finance Institute Research Paper |
| Number | 19-03 |
| Number of Pages | 91 |
| Date | 2023 |
| Abstract Text | Mergers and acquisitions are often motivated by the intention of creating value from intangible assets. We develop a novel word list of intangibles and apply it to takeover announcements. The value of these deals to the acquirer, as shown by abnormal announcement returns, is questionable: One standard deviation more in intangibles talk lowers returns by 0.50 percentage points. Agency problems explain little of these results. Rather, the cross-section of announcement returns, payment mode choices, and insider trades suggest that intangibles talk reflects managerial overoptimism. In sum, takeover announcements reveal important information regarding the quality of deals. |
| Free access at | DOI |
| Digital Object Identifier | 10.2139/ssrn.3330623 |
| Other Identification Number | merlin-id:23721 |
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| Keywords | Corporate announcements, intangible assets, intangibles talk, mergers and acquisitions, takeovers, textual analysis |