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dc.contributor.authorMatthys, Thomas
dc.contributor.authorDahiya, Sandeep
dc.contributor.authorHallak, Issam
dc.date.accessioned2019-05-06T12:46:23Z
dc.date.available2019-05-06T12:46:23Z
dc.date.issued2018en_US
dc.identifier.urihttp://hdl.handle.net/20.500.12127/6341
dc.description.abstractDo banks worry about expropriation when an activist hedge fund targets their borrowers or are they reassured that their borrowers will perform better after such targeting? We study 1,435 events from 1996-2013 in which an activist targeted a US corporation to examine what happens to loan contract terms post-targeting. We find that banks charge a higher interest rate for loans made after the activist involvement compared to a matched sample of borrowers that were not targeted. However, we find that the initial stock price reaction to the announcement of an activist intervention is a strong predictor of post-target loan rates. Banks increase the loan rates for those targets that experience a strong positive stock price reaction. These findings suggest that banks adjust their loan pricing to reflect their concerns about wealth expropriation.en_US
dc.language.isoenen_US
dc.subjectBanksen_US
dc.titleTargeted by an activist hedge fund, do the lenders care?en_US
dc.contributor.departmentGeorgetown Universityen_US
dc.contributor.departmentJRC - European Commissionen_US
vlerick.conferencedate20/09/2018en_US
vlerick.conferencelocationAntwerp, Belgiumen_US
vlerick.conferencename15th Corporate Finance Dayen_US
vlerick.conferenceorganiserUniversity of Antwerpen_US
vlerick.knowledgedomainAccounting & Financeen_US
vlerick.typeconfpresConference Presentationen_US
vlerick.vlerickdepartmentAFen_US
dc.identifier.vperid137776en_US


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