Post-Takeover Effects on Thai Bidding Firms: are Takeovers in the Bidder's Interests?
World Scientific Publishing
Faculty of Business and Law
School of Accounting, Finance and Economics
This paper analyses takeover effects on the Thai stock market in terms of their impact on the bidding firms' shareholders. We apply a comprehensive analysis ofshareholder wealth effects using multiple methods. Our results conform with prior studies: see Jensen and Ruback (1983), Agrawal and Jaffe (1999), Bruner (2002) and Campa and Hernando (2004). Thai takeovers result in significant negative abnormal returns over the sixteen months after the takeover. The abnormal return, variously defined, vary from -4% to -6%, and -0.20% (monthly) for the bidding firm's shareholders. Thai takeovers do not appear to add to bidding firms' shareholder wealth.