Finance Seminar: Professor Alfred Yawson
Central Hub M&A Advisors
This paper examines whether acquiring firms benefit from advisor network centrality, which measures the extent and strength of a financial advisor's connections with other investment banks in the M&A market. We find that a more centrally positioned financial advisor helps acquiring firms garner higher announcement abnormal returns and purchase targets at a lower price. The results hold when we employ a difference-in-differences technique that relies on variation generated by an exogenous shock to advisor networks, as well as an instrumental-variable approach. The effect of advisor network centrality on acquirer abnormal returns varies in the cross-section, with the effect stronger in deals characterized by greater information asymmetry surrounding the target firm. Consistent with their value added role, centrally positioned advisors charge higher M&A advisory fees. Overall, our findings suggest that centrally positioned financial advisors leverage “who they know” to enhance the value of their acquirer clients.
Alfred Yawson is a Professor in Corporate Finance and Associate Head (Research) at the School of Accounting and Finance, University of Adelaide. Prior to taking up this position he held various academic position the University of Adelaide, the University of New South Wales and Cass Business School, City University London. His primary research interests are corporate finance, particularly corporate restructuring (mergers and acquisitions, divestitures, employee layoffs and strategic alliances, investment banking) and corporate governance. He has won competitive grant from the Australian Research Council (ARC) and a number of awards for research excellence. He has published in leading finance journals including the Journal of Financial Economics, Journal of Corporate Finance and Journal of Banking and Finance. He is currently the Editor-in-Chief, International Journal of Managerial Finance. Professor Yawson obtained a first class honours degree in Accounting from the University of Ghana, a Master of Science in Finance with distinction and a PhD in Finance from Queen’s University Belfast in the UK. He is a Chartered Accountant with industry experience from reputable financial institutions. Professor Yawson was part of the government team that pioneered the Value Added Tax policy implementation in Ghana.