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

Martin Bugeja, Raymond da Silva Rosa, H. Y. Izan, Susan Ngan

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

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.

Original languageEnglish
Pages (from-to)2235-2271
Number of pages37
JournalAccounting and Finance
Volume59
Issue number4
DOIs
Publication statusPublished - Dec 2019

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abstract = "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.",
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Choice of acquisition form in Australia and the post-takeover employment of target firm directors on the acquiring firm board. / Bugeja, Martin; da Silva Rosa, Raymond; Izan, H. Y.; Ngan, Susan.

In: Accounting and Finance, Vol. 59, No. 4, 12.2019, p. 2235-2271.

Research output: Contribution to journalArticle

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