Economic consequences of announcing strategic alternatives: A voluntary disclosure's benefits and costs

IF 3.2 3区 管理学 Q1 BUSINESS, FINANCE Contemporary Accounting Research Pub Date : 2023-06-10 DOI:10.1111/1911-3846.12880
Jenny Zha Giedt
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Abstract

This study examines the benefits and costs to a company of publicly announcing that it is seeking a potential sale or merger. I find that the announcement leads to increased market attention and a more robust merger and acquisition sales process—the benefits of improved transparency. However, I also find evidence of the announcement alienating stakeholders and increasing business disruption—the costs of credible disclosure. I document the countervailing valuation effects of these benefits and costs, where the net valuation effect depends on whether the company is subsequently acquired. This research is important because it (1) demonstrates the disclosure's impact on the company through multiple channels, (2) estimates the valuation effects, and (3) identifies key considerations for investors and other stakeholders who bear the consequences of such a disclosure.

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宣布战略替代方案的经济后果:自愿披露的收益和成本
本研究考察了公司公开宣布寻求潜在出售或合并的收益和成本。我发现,这一公告增加了市场的关注,使并购销售过程更加稳健——这是提高透明度的好处。然而,我也发现有证据表明,该公告疏远了利益相关者,增加了业务中断——可信披露的成本。我记录了这些收益和成本的抵消性估值效应,其中净估值效应取决于公司随后是否被收购。本研究之所以重要,是因为它(1)通过多个渠道展示了披露对公司的影响,(2)估计了估值效应,(3)确定了承担此类披露后果的投资者和其他利益相关者的关键考虑因素。
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来源期刊
CiteScore
6.20
自引率
11.10%
发文量
97
期刊介绍: Contemporary Accounting Research (CAR) is the premiere research journal of the Canadian Academic Accounting Association, which publishes leading- edge research that contributes to our understanding of all aspects of accounting"s role within organizations, markets or society. Canadian based, increasingly global in scope, CAR seeks to reflect the geographical and intellectual diversity in accounting research. To accomplish this, CAR will continue to publish in its traditional areas of excellence, while seeking to more fully represent other research streams in its pages, so as to continue and expand its tradition of excellence.
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