What is the stock price reaction to the announcements of corporate real estate acquisitions by listed non-property companies in Malaysia? Do acquisitions under different economic conditions lead to different price reactions?

This is the issue explored by Ting Kien Hwa of Universiti Teknologi MARA and Mani Usilappan of the University of Malaya.

Their results show that the cumulative abnormal returns associated with the property acquisitions differ significantly in different economic conditions.

Acquisitions that took place before the Asian financial crisis were consistent with the normal investor expectations of increasing shareholder value. However property acquisitions during and after the crisis have the opposite effect.