Do Financial Advisors Matter for M&A Leakage?

This paper explores whether financial advisors matter for M&A leakage. We regress abnormal stock behavior prior to M&A announcements on the identities of financial advisors using data on public U.S. transactions announced between 1990 and 2013. We document that the identity of the financial advisor is systematically related to abnormal stock behavior. The economic magnitude is substantial with an interquartile range of advisor coefficients of approximately 9%. Exploiting enforcement events as shocks to advisor-specific leakage propensities, our findings lend support to the notion that advisors matter for leakage.