The probability of a firm making a takeover bid: An empirical analysis of Australian firms
This study develops a prediction model to investigate the probability of firms making a takeover bid. This model draws upon a number of firm characteristics, which can be categorized under three types of theory: agency costs, hubris behaviour and synergy motives. By examining a sample of 316 Austral...
| Main Author: | |
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| Format: | Journal Article |
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Sage Publications
2014
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| Online Access: | http://hdl.handle.net/20.500.11937/34201 |
| _version_ | 1848754158176305152 |
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| author | Akhtar, Farida |
| author_facet | Akhtar, Farida |
| author_sort | Akhtar, Farida |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | This study develops a prediction model to investigate the probability of firms making a takeover bid. This model draws upon a number of firm characteristics, which can be categorized under three types of theory: agency costs, hubris behaviour and synergy motives. By examining a sample of 316 Australian publicly listed firms over the period 1999–2010, this study finds that bidding firms are significantly different from non-bidding firms in terms of their cash level, leverage, capital expenditure (long-term productivity growth) and management overconfidence level. Bidding firms are predisposed to enter into takeover activities because their management’s investment decisions are primarily driven by agency, hubris behaviour and synergy motives. The findings show that hubris behaviour is more dominant in influencing managers’ investment decisions in a takeover bid rather than agency or synergy motives. |
| first_indexed | 2025-11-14T08:35:57Z |
| format | Journal Article |
| id | curtin-20.500.11937-34201 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T08:35:57Z |
| publishDate | 2014 |
| publisher | Sage Publications |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-342012017-09-13T15:10:07Z The probability of a firm making a takeover bid: An empirical analysis of Australian firms Akhtar, Farida takeover announcement synergy motives sample selection model hubris behaviour non-bidder organic growth bidder Agency This study develops a prediction model to investigate the probability of firms making a takeover bid. This model draws upon a number of firm characteristics, which can be categorized under three types of theory: agency costs, hubris behaviour and synergy motives. By examining a sample of 316 Australian publicly listed firms over the period 1999–2010, this study finds that bidding firms are significantly different from non-bidding firms in terms of their cash level, leverage, capital expenditure (long-term productivity growth) and management overconfidence level. Bidding firms are predisposed to enter into takeover activities because their management’s investment decisions are primarily driven by agency, hubris behaviour and synergy motives. The findings show that hubris behaviour is more dominant in influencing managers’ investment decisions in a takeover bid rather than agency or synergy motives. 2014 Journal Article http://hdl.handle.net/20.500.11937/34201 10.1177/0312896214534863 Sage Publications unknown |
| spellingShingle | takeover announcement synergy motives sample selection model hubris behaviour non-bidder organic growth bidder Agency Akhtar, Farida The probability of a firm making a takeover bid: An empirical analysis of Australian firms |
| title | The probability of a firm making a takeover bid: An empirical analysis of Australian firms |
| title_full | The probability of a firm making a takeover bid: An empirical analysis of Australian firms |
| title_fullStr | The probability of a firm making a takeover bid: An empirical analysis of Australian firms |
| title_full_unstemmed | The probability of a firm making a takeover bid: An empirical analysis of Australian firms |
| title_short | The probability of a firm making a takeover bid: An empirical analysis of Australian firms |
| title_sort | probability of a firm making a takeover bid: an empirical analysis of australian firms |
| topic | takeover announcement synergy motives sample selection model hubris behaviour non-bidder organic growth bidder Agency |
| url | http://hdl.handle.net/20.500.11937/34201 |