Acquirer Shareholder Voting
Dr. Julie Wu’s newest research investigates the function of acquirer shareholder voting during mergers and acquisitions.

Acquirer Shareholder Voting

November 9, 2018
Dr. Julie Wu, assistant professor of finance, earned her Ph.D. in finance from Mays Business School at Texas A&M University. She was at the Terry College of Business at the University of Georgia prior to joining Nebraska Business in 2016. Her research interests include securities markets, empirical asset pricing and corporate finance. Her articles have been published in Review of Financial Studies, Journal of Financial Markets, Journal of Corporate Finance, Journal of Financial Intermediation and Contemporary Accounting Research and featured in Harvard Law School Forum.
 
Wu’s newest research investigates the function of acquirer shareholder voting during mergers and acquisitions. This study shows acquirers with low institutional ownership, high deal risk and high agency costs are more likely to bypass shareholder voting, leading to lower announcement returns and higher offers. To avoid shareholder voting, acquirers increase equity issuance and cut payout in the year before the merger. Wu and her co-authors also document a positive causal effect of shareholder voting concentrated among acquirers with higher institutional ownership. The authors conclude institutional monitoring adds value and mitigates agency issues in mergers and acquisitions.

This study presents fresh evidence on why and how acquirer management manipulates deal financing to avoid shareholder voting and its value consequence. We show the prospect of a shareholder vote commits acquirer management to making good deals. This study improves our understanding of the role of shareholder voting in the largest merger and acquisition market in the world.

"This study presents fresh evidence on why and how acquirer management manipulates deal financing to avoid shareholder voting and its value consequence. We show the prospect of a shareholder vote commits acquirer management to making good deals. This study improves our understanding of the role of shareholder voting in the largest merger and acquisition market in the world."
Dr. Julie Wu
Assistant Professor of Finance