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March 18, 2026International Review of FinanceOpen Access

Does Bidder Complexity Affect Market Reactions to M&A Decisions?

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Authors

RCRajib ChowdhuryJDJohn A. Doukas

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Overview

Analysis reveals bidder complexity impacts market reactions to M&A announcements, indicating investor perceptions of value.

Key Points

  • The research aims to understand how bidder complexity affects investor reactions to M&A announcements.
  • Analyzed the relationship between bidder complexity and cumulative abnormal returns (CAR) using established measures.
  • Examined subsets of bidders based on operating risk, R&D intensity, and firm size.
  • Investigated the correlation between bidder complexity and takeover premiums offered.
  • Found a significant positive relationship between bidder complexity and cumulative abnormal returns.
  • Noted that complex bidders often have higher operating risk, R&D intensity, and larger firm size.
  • Complex bidders generally offer higher takeover premiums, suggesting they are seen as more capable.

Cite This Study

Chowdhury et al. (2026) studied this question.

synapsesocial.com/papers/69ba434a4e9516ffd37a4541https://doi.org/10.1111/irfi.70066
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