M and A
Posted by WARREN MOSLER on September 28th, 2009
As anticipated, this will be larger than ever as the only way to be protected as a shareholder is to buy the whole company.
And the general risks to being a minority shareholder will keep prices lower than otherwise.
M&A Is Back—And May Bring Big Opportunities for Investors
By Jeff Cox
Sept. 25 (Bloomberg) — After missing in action for much of this year’s stock rally, mergers and acquisitions are making a big comeback.
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September 28th, 2009 at 1:28 pm
Mergers are part of mechanical linkage to boost bank profits yet provide little benefit to the real economy? Treasury/Fed willing to allow almost anything to boost private borrowing?
” The study looked at deals done in the merger waves of 2005, 2004, 1998, and 1988.
For the first phase, researchers studied data from global M&A deals with an inflation-adjusted value of between $400 million and $1.5 billion, tracking performance over the six months after the announcement of each deal. Over that time period, transactions occurring in 2004 outperformed the global Morgan Stanley Capital International (MSCI) index by 7 percent according to the study. By comparison, deals in 1998 underperformed by 3 percent over a similar time frame, while deals that occurred in 1988 fell off by 6 percent.”
http://www.cfo.com/article.cfm/8399954?f=related&origin=archive
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