Capital gains taxation and shareholder wealth in takeovers

Before December 1999, the capital gains of shareholders who sold their shares into Australian takeovers have been taxable irrespective of payment method. Subsequently, shareholders can elect to rollover capital gains in equity takeovers. We examine the effect of this change on the association between target shareholder capital gains and bidder and target firm shareholder wealth. The results indicate that prior to the regulatory change, cash consideration results in higher target shareholder returns for non-taxation reasons. After the introduction of capital gains tax rollover relief, we find that target and acquiring firm shareholders earn lower returns when cash consideration is offered to shareholders with greater capital gains. © The Authors. Journal compilation © 2009 AFAANZ

Market returns to acquirers of substantial assets

Does poor post-acquisition performance characterise firms that make non-M&A acquisitions? We investigate the wealth effects of substantial asset acquisitions (i.e. acquisitions that cost over $10 million) on acquiring firms' shareholders. We find significant abnormal positive market reaction to asset acquisition announcements and, contrary to findings for firms undertaking M&As, the acquiring firms perform exceptionally well post-acquisition. Our findings are robust to the research method weaknesses common to many studies of long-term performance and we control for free-cash-flow as well. Our results contradict the hubris hypothesis of acquisitions and lend weight to the argument that the auction-style process that characterizes corporate takeover bids contributes to overpayment

The Demutualisation of the Australian Stock Exchange: Causes and Consequences

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Competition in the market for takeover advisers

We investigate factors that motivate bidders to engage advisers, we model adviser selection and we test whether value-adding advisers gain market share. Our sample includes 801 attempted takeovers over 1989-1998 in Australia. Our results indicate advisers are likely to be engaged if the takeover deal is large, hostile, and includes non-cash compensation. We find deal completion is not as closely correlated with adviser rankings as does Rau (2000) but we confirm his finding that adviser ranked high on market value of deals advised do not have a comparative advantage in adding value to firms. However, we document some (limited) evidence that value- adding advisers achieve an increase in subsequent deal flow. Our results are consistent with specialization among takeover advisers

Choice of acquisition form in Australia and the post-takeover employment of target firm directors on the acquiring firm board

© 2017 AFAANZ In Australia, a corporate acquisition can be structured as either a scheme of arrangement or a takeover. We investigate the association between deal structure and the retention of target directors on the merged entity board. We find that the odds of a target director subsequently sitting on the merged entity's board are significantly higher in schemes. The results also show that premiums are lower in schemes of arrangement when additional target directors are appointed to the board of the acquiring firm. The findings indicate that target director appointment is unrelated to the merged entity's post-acquisition performance

To scheme or bid? Choice of takeover method and impact on premium

© 2015, © The Author(s) 2015. In recent years there has been an increasing use of members’ schemes of arrangement to bring about a change in corporate control. This increasing use of schemes has been criticised in public quarters on the basis that unlike takeovers, schemes are not subject to the Eggleston principles and have arguably led to target shareholders receiving lower offer prices. This study provides the first large-sample empirical evidence on differences between schemes and takeovers. We find that the likelihood of the use of schemes significantly increases when target firm ownership concentration is higher and when the bidder has a lower toehold. Scheme usage is also more likely for larger targets and bidders with higher leverage. Consistent with public criticisms of schemes, we find that after controlling for self-selection premiums in schemes are significantly lower than those in takeovers

A new gravitational N-body simulation algorithm for investigation of cosmological chaotic advection

Recently alternative approaches in cosmology seeks to explain the nature of dark matter as a direct result of the non-linear spacetime curvature due to different types of deformation potentials. In this context, a key test for this hypothesis is to examine the effects of deformation on the evolution of large scales structures. An important requirement for the fine analysis of this pure gravitational signature (without dark matter elements) is to characterize the position of a galaxy during its trajectory to the gravitational collapse of super clusters at low redshifts. In this context, each element in an gravitational N-body simulation behaves as a tracer of collapse governed by the process known as chaotic advection (or lagrangian turbulence). In order to develop a detailed study of this new approach we develop the COsmic LAgrangian TUrbulence Simulator (COLATUS) to perform gravitational N-body simulations based on Compute Unified Device Architecture (CUDA) for graphics processing units (GPUs). In this paper we report the first robust results obtained from COLATUS.Comment: Proceedings of Sixth International School on Field Theory and Gravitation-2012 - by American Institute of Physic