Do Mergers and Acquisitions Improve Informativeness About the Acquirer's Stock?

Summary Are mergers and acquisitions significant events which develop informativeness seen as the disclosure of private and specific information after a transaction? Is the informativeness process the same between countries? To answer to these questions we use the concept of informativeness, as first developed by Roll (1988). We consider a sample of mergers and acquisitions in the US and in Europe over the 2000-2011 period. We show that the disclosure process is not linked with acquirer’s abnormal returns at the announcement date. Informativeness improves over time. We show that the acquisition premium and the means of payment are particularly important in the disclosure process.