İnsider training before mergers and acquisitions deals

This study was performed to understand the effects of insider trading prior to company mergers and acquisitions that take place in our country. For this purpose; 50 merger and acquisition transactions of 35 companies operating in finance, energy, food, service and media-entertainment sectors in our country between 2005-2013 were studied. 16 of those companies studied had performed 100% merger transactions and 34 of them entered into partnership with each other. In our study, share prices of the companies traded in Istanbul Stock Exchange for 1 year, 6 months, 3 months and 1 month before disclosure of merger and acquisition transactions to the Public Disclosure Platform (KAP) and also on the date of disclosure to KAP were considered and stock exchange data were compared and -Z- values were calculated for the time interval determined for each company. –Z- values calculated were analyzed according to the significance level in the confidence interval of 90%, 95% and 99%. In accordance with the results obtained, meaningful findings were determined for insider trading in almost all merger and acquisition transactions in our country particularly prior to the disclosure to KAP. This is mainly because merger and acquisition transactions are negotiated and discussed within company before disclosure to KAP. Here, the date of disclosure to KAP refers to official disclosure. Therefore availability of information for use by authorized officers or possibility of leakage during the period until the date of disclosure to KAP has enabled us to obtain meaningful results about insider trading. As our study is a first in the literature and is a scientific study, it does not judge any person or organization. Key Words : Merger, Acquisition, Take Over, Stock Certificat Performance, Insider Information