Seminario al Dipartimento di Economia - DSEA

24.05.2018

ore 15.30 Sala Seminari – I° piano, Palazzo Levi Cases, Via del Santo 33

Justin Chircop (Lancaster University)

“10-K filing length and M&A efficiency” (co-authored by M. Tarsalewska)

Abstract
This article explores the association between 10-K filing length and M&A efficiency. We posit that 10-K filing length influences acquirer information and processing costs. Longer 10-K filings reduce acquirer information acquisition costs, by making available more information about the target, and increase acquirer processing costs, by increasing the difficulty in extracting information about the target. Which of these two effects dominates determines the relation between 10-K filing length and M&A efficiency. We find that 10-K filing length is positively related to M&A efficiency, suggesting that the reduction in information acquisition costs dominates the increase in processing costs. This result is robust to controlling for different measures of textual complexity, and for the level of public information available about the target.