2006 Fiscal Year Final Research Report Summary
An Empirical Study on Earnings Management and the Stock Price Effect of M＆A in Japan
| Project/Area Number |
17530348
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| Research Category |
Grant-in-Aid for Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
Accounting
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| Research Institution | Meijo University |
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Principal Investigator |
TASHIRO Tatsuhiko Meijo University, Faculty of Business Management, Professor, 経営学部, 教授 (90268061)
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| Co-Investigator(Kenkyū-buntansha) |
ISHII Yasuhiko Takachiho University, Faculty of Commerce, Associate Professor, 商学部, 助教授 (70305176)
NAKAYAMA Shigeho Toyohashi Sozo Junior college, Associate Professor, 助教授 (80331635)
ASANO Takashi Aichi Shukutoku University, Faculty of Business, Associate Professor, ビジネス学部, 助教授 (30329833)
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| Project Period (FY) |
2005 – 2006
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| Keywords | Stock-for-stock merger / Earnings Management / Accruals / Stock Price Effect |
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| Research Abstract |
We study earnings management and the market performance of Japanese firms in stock-for-stock mergers.
We find (1) consistent with previous studies such as Erickson and Wang [1999], acquiring firms especially for group reorganization manage earnings upward preceding a stock swap announcement in order to lower the merger cost ; (2) the effect of merger on acquiring firms' stock prices is totally positive around a stock merger announcement ; (3) the merger for group reorganization has smaller effect on acquiring firms' stock prices than the merger for others ; (4) preceding stock-for-stock mergers, the market does not react to the earnings management of the acquiring firms for group reorganization ; and (5) around a stock merger announcement, the market reacts negatively to the earnings management on the latest two-interim periods prior to the announcement and discounts the stock price.
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Research Products
(2 results)
