Capital Shocks and Merger Activity in the Property-Liability Insurance Industry

  title={Capital Shocks and Merger Activity in the Property-Liability Insurance Industry},
  author={Sandra L. Chamberlain and Sharon},
This article investigates the prevalence of financial synergies as a motive for merger and acquisition activity in the property-liability insurance industry. Two hypotheses are developed and tested based upon theories of information asymmetries and firm financing decisions (Myers and Majluf 1984): (1) that financial synergies are a primary motive for insurance mergers in general and (2) that mergers motivated by financial synergies will be more prevalent in periods following negative industry… CONTINUE READING

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