Voluntary Disclosure with Uncertainty About Investors' Response: Evidence from M&A Conference Calls

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Voluntary Disclosure with Uncertainty About Investors' Response: Evidence from M&A Conference Calls

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Title: Voluntary Disclosure with Uncertainty About Investors' Response: Evidence from M&A Conference Calls
Author(s):
Jang, Youngki
Advisor: Cready, William M.
Radhakrishnan, Suresh
Date Created: 2018-08
Format: Dissertation
Keywords: Disclosure of information
Consolidation and merger of corporations
Telephone conferencing
Corporations—Investor relations
Abstract: I examine voluntary disclosure with uncertainty about investors’ response using conference calls around merger announcements. I find that deal announcement returns are either extremely positive or extremely negative for mergers with conference calls compared with such returns for mergers with no conference calls – a U-shaped relationship between returns and conference calls. This finding is consistent with voluntary disclosure theory, which suggests that managers disclose significant news when they are uncertain about investors’ response. The results are stronger when uncertainty about investors’ response is more pronounced: (a) when managers hold conference calls before they see investors’ response, (b) when acquirers’ stock return volatility prior to mergers is higher, (c) when acquirers have less agency concerns, and (d) when acquirers have more transient institutional ownership. Collectively, I show that uncertainty about investors’ response is a factor that should be considered when examining the consequence of voluntary disclosure.
Degree Name: PHD
Degree Level: Doctoral
Persistent Link: http://hdl.handle.net/10735.1/6186
Terms of Use: ©2018 The Author. Digital access to this material is made possible by the Eugene McDermott Library. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.
Type : text
Degree Program: Management Science

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