This paper uses a sample of 335 firms participating in non-equity and minority equity strategic alliances to reexamine value creation through strategic alliances. We show that the immediate positive response of stock markets to new strategic alliances is followed by negative abnormal returns. Twenty days after announcements, a cumulative positive abnormal return is only evident for those firms with the highest stock market response to the announcement. We relate the positive abnormal returns reported in previous research to the presence of short-run overreaction on stock markets and conclude with the market's ability to identify those alliances that are more valuable.
|Number of pages||22|
|Journal||International Journal of Banking, Accounting and Finance|
|State||Published - 1 Jan 2011|
- Event study
- Strategic alliance
All Science Journal Classification (ASJC) codes
- Economics and Econometrics