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Why do public bidders pay more than private bidders?

Why do public bidders pay more than private bidders?

The question of whether or not public companies pay too much when bidding for other companies came in for scrutiny from leading financial professionals, academics, and members of the business community at the World Trade Centre in Amsterdam recently, at the latest in the ‘Journeys with Erasmus’ series of conferences and debates, organised by Rotterdam School of Management, Erasmus University (RSM).

 A consensus quickly developed; they do, and the debate revealed why this happens.

 RSM’s Professor of Corporate Finance Frederik Schlingemann presented his research into public company deals throughout the 1990s with evidence of overpayments, but variations existed, he said, and explained why.

Other speakers were Eric Wijs, RSM alumnus and specialist in mergers and acquisitions as head of Lincoln International’s Benelux office and Kris Ruijters, RSM alumnus and Partner at international legal firm Boekel De Nerée in Amsterdam.

Over the course of the event, it emerged that the findings of the academic, who analysed 12,000 deals over two decades, closely mirrored the experience of the lawyer and the M&A advisor. Whilst covering a smaller statistical sample, Messrs Ruijters and Wijs were able to add rich detail to the statistical picture painted by Prof. Schlingemann.

A lively discussion ensued and this followed into the networking event afterwards. Many of the RSM alumni attending the event worked in M&A and their professional interest was combined with a relaxed social atmosphere that allowed people to share in common experience and learn from the journeys taken since leaving RSM.

For a more detailed report of the discussion, click here. To keep up-to-date with forthcoming alumni events, see the RSM alumni event webpages.

Rotterdam School of Management, Erasmus University is consistently ranked amongst the top 10 business schools in Europe. It is located in the international port city of Rotterdam where core Dutch values of openness, flexibility and acceptance of diversity have attracted businesses on a global scale. Our emphasis is on ground-breaking research and practices relevant to business; our primary focus is on developing business leaders who carry their innovative ideas into a sustainable future. Our portfolio includes a broad array of bachelor, master, doctoral, MBA and executive education programmes. www.rsm.nl

For more information on RSM or on this release, please contact Marianne Schouten, Media & Public Relations Manager for RSM, on +31 10 408 2877 or by email at mschouten@remove-this.rsm.nl.