Is acquiring-firm shareholder approval in stock-for-stock mergers perfunctory?

Timothy R. Burch, Angela G. Morgan, Jack G. Wolf

Research output: Contribution to journalArticlepeer-review

18 Scopus citations

Abstract

Despite mixed stock returns for acquirer shareholders in large stock-for-stock mergers, acquiring-firm merger proxy votes rarely fail; in the sample we examine, the average approval rate of votes cast is 95%, Our examination of whether merger votes are effective in monitoring management 's acquisition policy indicates that the margin of approval varies substantially with firm and deal characteristics, and while there are no failed votes in our sample some deals are only narrowly approved. These findings support the notion that merger proxy votes provide credible threats despite high average approval rates.

Original languageEnglish (US)
Pages (from-to)45-69
Number of pages25
JournalFinancial Management
Volume33
Issue number4
StatePublished - Dec 1 2004

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics

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