Synergy disclosures in mergers and acquisitions

Marie Dutordoir, Peter Roosenboom, Manuel Vasconcelos

Research output: Contribution to journalArticlepeer-review


We examine bidding firms' motives for disclosing a synergy forecast when announcing a merger or acquisition. Our sample consists of 1990 M&A deals, of which 345 announce synergy estimates. Our results suggest that synergy disclosures serve to obtain a more favorable market reception for deals that would otherwise induce highly negative bidder announcement returns. After controlling for the endogeneity of the disclosure decision, synergy forecast disclosures result in approximately 5% higher bidder stock returns. The main deterrents of disclosing synergy values are lack of precise information on synergy values available to bidding firm management, and shareholder litigation risk. Bidders do not seem to use synergy disclosures to strategically influence takeover premiums or competition for the target. © 2013 Elsevier Inc.
Original languageEnglish
Pages (from-to)88-100
Number of pages12
JournalInternational Review of Financial Analysis
Early online date11 Oct 2013
Publication statusPublished - Jan 2014


  • Information asymmetry
  • Mergers and acquisitions
  • Synergies
  • Voluntary disclosure


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