The Long Run Evidence About Corporate Raiders in Europe

This paper extends the analysis of the corporate raiders in Europe studied by Croci (2004). The paper provides an in-depth analysis of long-run performances of raiders' target firms. Raiders have been shareholders in a company for a rather short period. Although raiders affect corporate performance negatively, there is no clear evidence that raiders play any role in affecting firm performances both at stock price level and at accounting level. Clinical evidence about the activities of the raiders is provided, especially concerning greenmails and white-squire interventions. Thus, Holderness and Sheehan (1985) hypotheses are not supported. This result supports the findings in Croci (2004).