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Risk Arbitrage: A study of predictive variables in Nordic corporate takeovers

Eriksson, Oskar LU and Skålberg, Simon (2017) NEKH01 20162
Department of Economics
Abstract
The most critical element of doing risk arbitrage is the assessment of the out- come of a corporate takeover. Prediction models have been created in the past and successfully proven some variables in mergers and acquisitions to have a significant impact on the takeover outcome. However, these prediction models have mostly been created with U.S. data and some years back in time.
This thesis will investigate variables that previous studies have shown to have a predictive ability about the outcome of a corporate takeover and see if these previous findings are applicable in the Nordic markets as well. With the help of a logistic regression model, we have created a takeover prediction model based on a data sample containing 534 mergers and... (More)
The most critical element of doing risk arbitrage is the assessment of the out- come of a corporate takeover. Prediction models have been created in the past and successfully proven some variables in mergers and acquisitions to have a significant impact on the takeover outcome. However, these prediction models have mostly been created with U.S. data and some years back in time.
This thesis will investigate variables that previous studies have shown to have a predictive ability about the outcome of a corporate takeover and see if these previous findings are applicable in the Nordic markets as well. With the help of a logistic regression model, we have created a takeover prediction model based on a data sample containing 534 mergers and acquisitions in the Nordic markets over the period of 2000-2016. We found the variables time to completion, target size, percentage sought, toehold, attitude, private equity and competing bids to have a significant impact on the takeover outcome. (Less)
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author
Eriksson, Oskar LU and Skålberg, Simon
supervisor
organization
course
NEKH01 20162
year
type
M2 - Bachelor Degree
subject
keywords
Risk Arbitrage, Merger Arbitrage, Nordic Markets, Takeover Success Prediction, Mergers and Acquisitions
language
English
id
8902722
date added to LUP
2017-02-10 13:24:19
date last changed
2017-02-10 13:24:19
@misc{8902722,
  abstract     = {The most critical element of doing risk arbitrage is the assessment of the out- come of a corporate takeover. Prediction models have been created in the past and successfully proven some variables in mergers and acquisitions to have a significant impact on the takeover outcome. However, these prediction models have mostly been created with U.S. data and some years back in time.
This thesis will investigate variables that previous studies have shown to have a predictive ability about the outcome of a corporate takeover and see if these previous findings are applicable in the Nordic markets as well. With the help of a logistic regression model, we have created a takeover prediction model based on a data sample containing 534 mergers and acquisitions in the Nordic markets over the period of 2000-2016. We found the variables time to completion, target size, percentage sought, toehold, attitude, private equity and competing bids to have a significant impact on the takeover outcome.},
  author       = {Eriksson, Oskar and Skålberg, Simon},
  keyword      = {Risk Arbitrage,Merger Arbitrage,Nordic Markets,Takeover Success Prediction,Mergers and Acquisitions},
  language     = {eng},
  note         = {Student Paper},
  title        = {Risk Arbitrage: A study of predictive variables in Nordic corporate takeovers},
  year         = {2017},
}