財金講座研討會

財金系擬於2014年1月10日(五) 邀請林基財教授至本所進行專題演講，相關訊息如下：

時間: 1月10日(五) 上午10:30-12:00

地點: 台大管理學院一號館 2F 冠德講堂

演講人: 林基財教授

學校: Louisiana State University

講題: Limited Attention, Share Repurchases, and Takeover Risk.

Abstract:

We hypothesize that bidders may be unaware of potential undervalued targets, and that announcing open market share repurchases (OMRs) to counter undervaluation brings repurchasing firms to bidders' attention, and makes them more likely to become takeover targets and face higher takeover risk, a systematic risk proposed by Cremers, Nair, and John (2009). Indeed, we find that repurchasing firms face higher takeover probability in the years following OMR announcements, and that the increase in takeover risk can largely explain post-OMR long-run abnormal returns documented in the literature. The increase in takeover risk is larger for more undervalued firms and for those that announce larger repurchase programs. Our results suggest that OMRs, which are used by many firms to distribute cash to shareholders to counter undervaluation, could make the firms more sensitive to takeover waves and raise their cost of equity capital.