Horizontal acquisitions and rival stock returns: A competitive dynamics perspective
研究横向并购如何影响未参与并购的竞争对手的股票回报，发现收购方的攻击性和有效性会影响竞争对手的股价反应。
We investigate how horizontal acquisitions—deals involving direct competitors—affect the stock returns of uninvolved rivals. While previous research has primarily focused on relatively static industry and deal characteristics to assess an acquisition's impact on rival stock performance, we highlight the role of competitive behavior, which is unique to each acquirer and rival, evolves over time, and provides timely, and credible cues to investors. Specifically, we examine two key attributes of competitive behavior—action aggressiveness and action effectiveness—which can provide insights into how acquirers and rivals will behave post-acquisition. Analyzing a sample of 170 large horizontal acquisitions in the manufacturing sector from 2001 to 2014, we find that rivals experience positive stock returns at the announcement of such deals when acquirers are aggressive but perceived as lacking action effectiveness or when the rivals themselves are perceived to be highly effective. Conversely, when acquirers are perceived as both aggressive and effective, rivals incur negative returns. By shifting the focus to acquirers' competitive behavior, our study provides new insights into how horizontal acquisitions shape market reactions and rival stock returns.