Bidder and Target Size Effects in M&A Are Not Driven by Overconfidence or Agency Problems Available to Purchase

We would like to thank Kenneth Ahern, Nihat Aktas, Sugato Bhattacharyya, Joost Driessen, Gerard Hoberg, Matthias Kahl, Ron Masulis, Ernst Maug, Han Kim, Gordon Phillips, Per Stromberg, Toni Whited, Dong Yan, Ke Yang, and seminar participants at Australian National University, University of Cologne, University of Frankfurt, Frankfurt School of Finance & Management, Humboldt University of Berlin, University of Mannheim, University of Michigan, Monash University, University of Mϋnster, University Paris Dauphine, University of St. Gallen, University of Technology Sydney, Tilburg University, the 2016 DGF conference, the 2016 Stockholm School of Economics Finance Symposium, the 2016 Western Finance Association Conference, and the 2018 SFS Cavalcade Asia-Pacific for valuable comments and suggestions. We are responsible for any remaining errors or omissions. A previous version of this paper was titled: “Why does size matter so much for bidder announcement returns?”