Initial Offer Precision and M&A Outcomes

Petri Hukkanen, Matti Keloharju

Research output: Contribution to journalArticleScientificpeer-review

2 Citations (Scopus)


Building on recent research in social psychology, this paper analyzes the link between the precision of initial cash offers and mergers and acquisition (M&A) outcomes. About one-half of the offers are made at the precision of one or five dollars per share, while an additional one-third are made at the precision of a half dollar or one quarter. The practice of making offers at round price-per-share levels is associated with a higher purchase price for target shares and a lower probability of deal completion.

Original languageEnglish
Pages (from-to)291-310
JournalFinancial Management
Issue number1
Early online date10 Jul 2018
Publication statusPublished - 2019
MoE publication typeA1 Journal article-refereed

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