Abstract
The aim of this paper is to analyze the relation between the effects of mergers and the change of financial structures at the time of the merger. We propose two models. One is to examine the effects of mergers. We formulate the model for the time series variables of the financial index values which the acquiring companies would have taken if the mergers had not taken place. We estimate values from the actual values. The other is to quantify the change of financial structures by using the financial variable quantity based on Kullback-Leibler information quantity, which is the objective criterion to measure the distance of two distributions quantitatively. We show the validity of these models through the analysis of the data on 26 firms.
