Sky Blog
Despite decades of research on M&A outcomes, a puzzling question persists: Why do acquiring firms receive, on average, almost no cumulative abnormal returns around deal announcements (i.e., Betton, Eckbo, and Thorburn, 2008; Moeller, Schlingemann, and Stulz, 2004)? Numerous studies have …
After a relative low in global M&A in 2023, the past year witnessed a moderate uptick as the pandemic receded further into the rear-view mirror, the U.S. economy stabilized, inflation declined (albeit with some renewed concern toward the end of
Since 2000, of the total number of private firms that have gained access to the equity markets for the first time, more have done so through acquisition by another firm (public or private) than through an initial public offering (IPO). …
For nearly 40 years, scholars have debated whether business lawyers add value to transactions. The debate essentially started with an influential article by Professor Ronald Gilson, who characterized business lawyers as “transaction cost engineers.” These engineers optimize the costs of …
Startup acquisitions by incumbent firms have been on the rise for the last few years. These acquisitions often allow larger companies to acquire new technologies or talent, while startups gain access to resources and a wider customer base. One notable …
Seeking “strategic alternatives” is a euphemism for a company trying to sell itself, which typically results in an acquisition premium for shareholders, and many announcements of strategic alternatives explicitly state that the goal is maximizing shareholder value. Upon a company’s …
Consensus opinion coming into 2022 was that high M&A volume would continue, albeit not quite at the record-setting pace of 2021. The market had other plans. Volume decreased much more sharply from the 2021 high than was commonly expected. While …
Investment in financial technology, or FinTech, has increased dramatically over the past decade – from a total value of $9 billion worldwide in 2010 to well above $100 billion in recent years, with a peak of $215 billion in 2019. …
In his classic 1962 paper, “The Economic Implications of Learning by Doing,” Nobel laureate Kenneth J. Arrow argued that firms can gain proficiency through the repetition of activity. Since then, learning by doing, or LBD, has been widely studied across …
Antitrust regulators around the world, including in the UK, have recently proposed changes to merger review policies and enforcement strategies that have implications for how acquisitions of start-ups are investigated and evaluated. These changes will likely lead to heightened scrutiny—and …
Private equity (PE) firms have in recent years been spending more money on purchasing more hospitals than ever before, with such deals accounting for a sizeable chunk of the roughly $340 billion that PE firms have put into the U.S. …
In a recent blog post, the Acting Director of the Federal Trade Commission Bureau of Competition announced the reversal of the Federal Trade Commission’s (“FTC”) decades-long position regarding the treatment of debt repayment when determining whether a premerger notification …
Mergers and acquisitions are considered an integral part of a well-functioning governance system, an effective device for transferring corporate control to more capable owners and executives who can manage firm assets more efficiently and create economic value for shareholders of …
Acquisitions are at the core of corporate strategy, enabling companies to expand and reposition themselves in the market. In 2019 alone, they accounted for nearly $3.7 trillion of economic activity. Yet acquirers famously struggle to realize value from these transactions. …
While the obstacles women face in moving up the organizational hierarchy (captured in the popular metaphor of the “glass ceiling”) have been well studied, much less attention has been paid to understanding the circumstances women face after they reach senior …
The COVID-19 pandemic has created significant financial distress for many businesses and there have been a number of bankruptcy filings recently,[1] with more likely on the horizon. As a result, there is likely to be an increase in acquisitions …
The stereotypical image of the chief financial officer (CFO) as a mere bean-counter who only settles the books and tracks regulatory compliance no longer applies. Today, the CFO’s role has evolved from back-office treasurer to strategic business partner of the …
The number of private firms going public in the U.S. has declined significantly since 2000. A related phenomenon is that most private firms that “exit” (change ownership structures to allow early equity investors such as entrepreneurs and venture capitalists to …
When companies in financial difficulty are forced to sell assets – especially real assets such as factories, business units, real estate, or the entire company – the news is often seen as negative all around. In these situations, often referred …
The emergence and rapid escalation of COVID-19 continues to alter every facet of daily life across the globe. For businesses, challenges range from protecting and supporting employees and customers, to contributing to evolving efforts to battle COVID-19, to fighting for …