The warning effect of impression offsetting on M&A performance

Using 666 large acquisitions in China, we find that impression offsetting, proxied by unrelated positive announcements around mergers and acquisitions (M&As), negatively predicts long-term M&A performance, consistent with expectation violation theory. The warning effect is stronger for risky deals (cash‑financed M&As) and high-risk regions, and is more pronounced among non-state-owned enterprises, firms with high managerial power, high CEO confidence, and with high liquidity investors. The results help stakeholders identify the information cloak behind value-creation M&As.