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Event analysis of the impact of mergers and acquisitions on the financial performance of the U.S. forest products industry

Publication ,  Journal Article
Mei, B; Sun, C
Published in: Forest Policy and Economics
April 1, 2008

The U.S. forest products industry has witnessed an unprecedented period of mergers and acquisitions (M&As) in recent years. In this study, the impact of 70 M&As from 1990 to 2004 on the financial performance of 85 publicly traded forest firms was evaluated. The examination of abnormal returns revealed that the equity market had responded to these M&As. The average cumulative abnormal returns for all the firms as a group ranged from 1.66% for the 15-day event window to 3.03% for the 3-day event window. From the cross-sectional regressions, the position as a target firm and the relative transaction size explained a large portion of the variations of the individual firms' cumulative abnormal returns. Finally, risk analyses through the Capital Asset Pricing Model showed that the risk for some of the selected 14 acquiring firms had changed after the M&As. © 2007 Elsevier B.V. All rights reserved.

Duke Scholars

Published In

Forest Policy and Economics

DOI

ISSN

1389-9341

Publication Date

April 1, 2008

Volume

10

Issue

5

Start / End Page

286 / 294

Related Subject Headings

  • Forestry
  • 1605 Policy and Administration
  • 1402 Applied Economics
  • 0705 Forestry Sciences
 

Citation

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Mei, B., & Sun, C. (2008). Event analysis of the impact of mergers and acquisitions on the financial performance of the U.S. forest products industry. Forest Policy and Economics, 10(5), 286–294. https://doi.org/10.1016/j.forpol.2007.11.005
Mei, B., and C. Sun. “Event analysis of the impact of mergers and acquisitions on the financial performance of the U.S. forest products industry.” Forest Policy and Economics 10, no. 5 (April 1, 2008): 286–94. https://doi.org/10.1016/j.forpol.2007.11.005.
Mei, B., and C. Sun. “Event analysis of the impact of mergers and acquisitions on the financial performance of the U.S. forest products industry.” Forest Policy and Economics, vol. 10, no. 5, Apr. 2008, pp. 286–94. Scopus, doi:10.1016/j.forpol.2007.11.005.
Journal cover image

Published In

Forest Policy and Economics

DOI

ISSN

1389-9341

Publication Date

April 1, 2008

Volume

10

Issue

5

Start / End Page

286 / 294

Related Subject Headings

  • Forestry
  • 1605 Policy and Administration
  • 1402 Applied Economics
  • 0705 Forestry Sciences