Dividend policy following mergers and acquisitions
: european evidence

  • Maximilian Ernst Arens (Student)

Student thesis: Master's Thesis


This study finds evidence for the clientele effect of dividends in a European setting. I take advantage of M&A-transaction related changes to a firm’s shareholder base to confirm that acquiring shareholder adjust their dividend policy toward that of the target, thereby catering to the newly inherited shareholder preferences. Further, I analyze the impact of country-specific differences in governance regimes as well as in geographical and cultural distance on the mentioned dividend adjustment effect. When the acquirer comes from a relatively stronger governance regime, catering to target investor preferences is less pronounced whereas greater geographical and cultural distance causes the opposite effect. Moreover, my sample covering 1,046 transactions that took place between 01/01/1990 and 31/12/2017 suggests that higher differences in pre-merger dividend policies between target and acquirer reduce the likelihood of stock as payment method.
Date of Award8 Jul 2021
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorThomas David (Supervisor)


  • Dividend policy
  • Clientele effect
  • Mergers & acquisitions
  • Corporate governance
  • Cultural difference
  • Geographical distance
  • European market


  • Mestrado em Gestão e Administração de Empresas

Cite this