The phrase "acquisition premium" is correct and usable in written English.
It is typically used in financial contexts to refer to the additional amount paid over the market value of a company during an acquisition.
Example: "The acquisition premium offered by the acquiring company was significantly higher than the current stock price of the target company."
Alternatives: "purchase premium" or "takeover premium".
Moreover, neither company had to recoup an acquisition premium.
Combining both effects, golden parachutes are associated with a higher expected acquisition premium.
For instance, Connecticut requires Con Ed to pay an "acquisition premium" of $1.5 billion, which is included in the $3.8 billion takeover price.
In particular, our evidence suggests that bidder firms take advantage of information spillovers to reduce the acquisition premium paid to the target.
We show that this not only affects how deals are paid for, but also the acquisition premium and the types of deals.
The market for corporate control benefits shareholders not just by providing the prospect of pocketing an acquisition premium but also by affecting performance more generally.
In cross-border alliances, partners can avoid acquisition premiums while combining their strengths to target core or related businesses.
Analysts say a move to head off hostile takeovers could hurt minority shareholders by stripping merger and acquisition premiums from stock values.
Why do companies with golden parachutes fail to deliver for their shareholders overall even though they provide them with more benefits in the form of acquisition premiums?
Compared with acquisition premiums in deals with zero spillovers, bidders with strong (positive or negative) spillovers appear to acquire the target at a 5.4percentto10.6percentcent lower premium, which translates into mean (median) dollar savings of approximately $30 million to $60 million $12 million to $24 millionn) in the acquisition price.
Professor Wang's findings in an examination of golden parachutes indicate that they lead to more acquisitions and acquisition bids, but that they are ultimately associated with lower acquisition premiums.
