ABSTRACT
This chapter aims to share prices of failing companies collapse suddenly. The point being made is that when corporate failure is the focus of interest there is likely to be little of the common experience that is assumed in most event studies. This means that share price behaviour of failing companies will not only have to be viewed over relatively long intervals of time, but the data will be heterogeneous in nature. Logged security price returns for the failed companies were therefore taken from the London Business School share price database returns file for 60 months prior to the last year end before failure, and these were then matched against the corresponding returns for the paired control companies. The analysis of share price returns was conducted for both the critical events referred to earlier, namely the date of the final accounts of the failed company; and its date of failure.
