Acquirer characteristics and method of payment: Evidence from Chinese mergers and acquisitions

Agyenim Boateng, Xiaogang Bi

Research output: Journal PublicationArticlepeer-review

25 Citations (Scopus)


This study examines the effects of acquirer characteristics on method of payment of Chinese acquirers on the basis of a sample of 1370 mergers and acquisitions that occurred between 1998 and 2008. Using both buy and hold abnormal returns and calendar time abnormal returns approaches, we find that Chinese acquirers experience pre-acquisition abnormal returns ranging from 14.29% to 121% over the period of 12-36months prior to the acquisition relative to three different portfolio benchmarks. In the pre-bid period, acquisitions financed by shares outperform acquisitions financed by cash. However, in the post-acquisition period, we document no significant difference between cash-financed and equity-financed acquisitions. The study also finds that acquirer market value, Tobin's Q, state ownership and leverage have significant effects on the method of payment.

Original languageEnglish
Pages (from-to)540-554
Number of pages15
JournalManagerial and Decision Economics
Issue number8
Publication statusPublished - 1 Dec 2014

ASJC Scopus subject areas

  • Business and International Management
  • Strategy and Management
  • Management Science and Operations Research
  • Management of Technology and Innovation


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