Co-opted board and market reactions to acquisition announcements: acquisition efficiency
| Panel A: bid premium | Panel B: partial deals | |||||
|---|---|---|---|---|---|---|
| (1) | (2) | (3) | (4) | (5) | (6) | |
| BIDPREM | BIDPREM | BIDPREM | PARACQ | PARACQ | PARACQ | |
| PCO_OPT | 0.6112*** | – | – | −0.1926** | – | – |
| (3.42) | (−2.09) | |||||
| NCO_OPT | – | 0.0586*** | – | – | −0.0158* | – |
| (3.18) | (−1.77) | |||||
| RCO_OPT | – | – | 0.6051*** | – | – | −0.1994** |
| (3.38) | (−2.18) | |||||
| CONSTANT | −1.7518 | −1.2361 | −1.3581 | −2.2066*** | −2.3476*** | −2.3359*** |
| (−1.14) | (−0.79) | (−0.88) | (−2.62) | (−2.82) | (−2.76) | |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| R2/Wald-chi2 | 0.4041 | 0.4040 | 0.4041 | 1159.9506 | 1158.9619 | 1160.2459 |
| N | 8,939 | 8,939 | 8,939 | 8,939 | 8,939 | 8,939 |
| Panel A: bid premium | Panel B: partial deals | |||||
|---|---|---|---|---|---|---|
| (1) | (2) | (3) | (4) | (5) | (6) | |
| BIDPREM | BIDPREM | BIDPREM | PARACQ | PARACQ | PARACQ | |
| PCO_OPT | 0.6112*** | – | – | −0.1926** | – | – |
| (3.42) | (−2.09) | |||||
| NCO_OPT | – | 0.0586*** | – | – | −0.0158* | – |
| (3.18) | (−1.77) | |||||
| RCO_OPT | – | – | 0.6051*** | – | – | −0.1994** |
| (3.38) | (−2.18) | |||||
| CONSTANT | −1.7518 | −1.2361 | −1.3581 | −2.2066*** | −2.3476*** | −2.3359*** |
| (−1.14) | (−0.79) | (−0.88) | (−2.62) | (−2.82) | (−2.76) | |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| 0.4041 | 0.4040 | 0.4041 | 1159.9506 | 1158.9619 | 1160.2459 | |
| 8,939 | 8,939 | 8,939 | 8,939 | 8,939 | 8,939 | |
| Panel C: days to completion | Panel D: completed deals | |||||
|---|---|---|---|---|---|---|
| (1) | (2) | (3) | (4) | (5) | (6) | |
| LOGDAYS | LOGDAYS | LOGDAYS | COMPLETED | COMPLETED | COMPLETED | |
| PCO_OPT | −0.2044*** | – | – | −0.3283*** | – | – |
| (−2.69) | (−2.96) | |||||
| NCO_OPT | – | −0.0226*** | – | – | −0.0238** | – |
| (−3.09) | (−2.25) | |||||
| RCO_OPT | – | – | −0.2024*** | – | – | −0.3186*** |
| (−2.68) | (−2.91) | |||||
| CONSTANT | −0.5520 | −0.7547 | −0.6837 | 1.6797* | 1.4604 | 1.4691 |
| (−0.74) | (−1.00) | (−0.91) | (1.83) | (1.53) | (1.59) | |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| R2/Wald-chi2 | 0.2778 | 0.2781 | 0.2778 | 1544.1527 | 1542.2412 | 1545.0912 |
| N | 7,099 | 7,099 | 7,099 | 8,939 | 8,939 | 8,939 |
| Panel C: days to completion | Panel D: completed deals | |||||
|---|---|---|---|---|---|---|
| (1) | (2) | (3) | (4) | (5) | (6) | |
| LOGDAYS | LOGDAYS | LOGDAYS | COMPLETED | COMPLETED | COMPLETED | |
| PCO_OPT | −0.2044*** | – | – | −0.3283*** | – | – |
| (−2.69) | (−2.96) | |||||
| NCO_OPT | – | −0.0226*** | – | – | −0.0238** | – |
| (−3.09) | (−2.25) | |||||
| RCO_OPT | – | – | −0.2024*** | – | – | −0.3186*** |
| (−2.68) | (−2.91) | |||||
| CONSTANT | −0.5520 | −0.7547 | −0.6837 | 1.6797* | 1.4604 | 1.4691 |
| (−0.74) | (−1.00) | (−0.91) | (1.83) | (1.53) | (1.59) | |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes |
| Year fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| Industry fixed effects | Yes | Yes | Yes | Yes | Yes | Yes |
| 0.2778 | 0.2781 | 0.2778 | 1544.1527 | 1542.2412 | 1545.0912 | |
| 7,099 | 7,099 | 7,099 | 8,939 | 8,939 | 8,939 | |
Note(s): This table presents the regression results of co-opted board on acquisition efficiency with other control variables. Robust two-tailed t-statistics clustered by firm are presented in parentheses. The superscripts ***, ** and * correspond to statistical significance at the 1%, 5% and 10% levels, respectively. We present the variable definitions in the Appendix
Source(s): Authors’ own work
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