The post-­‐merger performance of “smart” and “non-­‐smart” acquirers:

This paper examines the post-­‐merger performance of the acquirers, who buy fundamental growth options of targets using the overvalued stock (the “smart” acquirers), and those who follow other merger strategies (“non-­‐smart”). The results show, that smart acquirers outperform the non-­‐smart ones at the periods (and in sectors) that are associated with the higther volatility, e.g. years of crisis or innovative industries. At the periods of stable economic environment the “smart” strategies do not bring the better results to the acquirers. Even further, smart bidders are able to capitalize on the market inefficiencies, increasing the fundamental growth option value at the expence of the excess pricing component, while non-­‐smart ones are not able to do so.