The effects of corporate mergers and acquisitions on shareholder wealth: recent experience in China

Abstract

The objectives of the study are 1) to explore the motives berund the recent mergers and acquisitions (M&As) in China; 2) to present an overview and to trace the development of the M&As market in China; and 3) to study the short-run and long-run effects of corporate M&As in China on the wealth of the shareholders. This paper examines the abnormal returns and cumulative abnormal returns on acquiring firms surrounding the M&As announcements. The sample companies include acquiring firms listed on the Shanghai and Shenzhen Stock Exchanges during the period 1990 to 1998.