New Evidence on M&A and Antitrust Policy
Friday, Jan. 6, 2023 10:15 AM - 12:15 PM (CST)
- Chair: Ginger Zhe Jin, University of Maryland and NBER
Strategic announcements of nonreportable mergers
AbstractAntitrust attorneys commonly caution clients that information contained in press releases can increase scrutiny of ``competitively sensitive'' mergers that might otherwise escape detection. Thus, merging parties may strategically avoid publicizing the terms of the deal (e.g., the value of the transaction), especially in cases where they are not required to directly inform the authorities of the merger. Yet, analysis of economy-wide merger activity typically omits mergers with unpublicized values. Using novel data and recently proposed methods, I argue that this omission leads researchers to mischaracterize merger activity and severely mismeasure the extent of stealth consolidation.
Startup Buyout and Patentable Innovation: New Evidence from PatentsView
AbstractMany entrepreneurs found technology startups to develop original ideas, with an eye toward IPO or buyout as a successful exit. However, policymakers are increasingly concerned that incumbent acquisitions of startups may slow down rather than speed up or expand the innovations of the acquired companies. To address this concern, we merge S&P-compiled data on technology acquisitions between 2007 and 2021 with PatentsView data since 1976 from the US Patent and Trademark Office. We then compare the patent profiles of acquirers and targets, and document changes in acquirers' profiles in terms of patent volume, direction, and significance after startup acquisition.
Mergers & Acquisitions under Common Ownership
AbstractWe provide new facts about the cross-section and evolution of mergers and acquisitions for U.S. public firms. Using a general equilibrium model with a hedonic demand system and data on institutional ownership, we document the degree of product market competition and common ownership among merging and non-merging firms. We then quantify how the effects of mergers on profits, consumer surplus, and total surplus are affected by common ownership and shareholder value maximization motives.
- D4 - Market Structure, Pricing, and Design
- G3 - Corporate Finance and Governance