NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Paul Healy

Harvard Business School
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Boston, MA 02163
Tel: 617 566-1748

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NBER Working Papers and Publications

January 1993International Corporate Equity Associations: Who, Where, and Why?
with Krishna G. Palepu
in Foreign Direct Investment, Kenneth A. Froot, editor
May 1990Does Corporate Performance Improve After Mergers?
with Krishna G. Palepu, Richard C. Rubak: w3348
We examine the post-acquisition operating performance of merged firms using a sample of the 50 largest mergers between U.S. public industrial firms completed in the period 1979 to 1983. The results indicate that merged firms have significant improvement in asset productivity relative to their industries after the merger, leading to higher post-merger operating cash flow returns. Sample firms maintain their capital expenditure and R&D rates relative to their industries after the merger, indicating that merged firms do not reduce their long-term investments. There is a strong positive relation between postmerger increases in operating cash flows and abnormal stock returns at merger announcements, indicating that expectations of economic improvements underlie the equity revaluations of the me...

Published: JFEC, Vol. 31, no. 2 (1992): 135-176.

 
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