This study investigates the short term share price performance of firms involved in domestic and cross - border Merger & Acquisition transactions during the period 15/8/2000 - 18/3/2013 . The sample is comprised of 111 bidder and 86 target firms in the telecommunication industry. The corporate M&As that are observed globally in this event study are characterized by strategies of horizontal and vertical integration, typically friendly, and are related to the majority stake-holding of the target firm (i.e. 51 - 100%). The present event study examines the relationships between the wealth changes associated to a takeover announcement to investigate whether a presumed synergy trap exists among M&A activities. The fact that M&A transactions analyzed fail to create value for bidder shareholders in a significant way while at the same time they create significant value for target investors suggests that the motivations for most of the deals reveals an agency or hubris problem in the acquiring firms. In general the empirical evidence suggests that in both cases (i.e. domestic & cross - border) the promised synergies are not realized. It also suggests that the presumed synergy trap that exists with M&A activities is not detrimental for bidder investors value. In other words, the analysis fails to support the hypothesis that a cross - border M&A deal, rather than a domestic deal, is the main instigator of a negative market reaction for the bidder firm while succeeds to confirm the hypothesis that M&As in general create value for target firms. Please notice that arguments or ideas on another person's work are quoted by subscripts.
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