Much as we journalists depend on leaks from companies, bankers and M&A lawyers, new research suggests that they might be better off keeping their mouths shut.

A study by IntraLinks and the Cass Business School in London found that only 49 percent of deals that get leaked to the media actually close, compared with 72 percent of non-leaked deals.

The study, which reviewed more than 350,000 mergers and acquisitions between 1994 and 2007, found that the premium paid by a buyer in a leaked deal was, on average, 13 percent lower than in non-leaked deals. That ran against the assumption by some sellers that news of a pending bid might attract rival suitors and increase the price, the researchers said.

Press attention also slowed the progress of deals, the study found. The average length of time for a non-leaked deal to close was 62 days, but the time frame increased by 43 days if the deal was disclosed prematurely.

“The time preceding a deal announcement is a particularly sensitive point in the M&A process and our research shows the potential damage caused by press leaks at this stage,” said Andrew Pearson, managing director EMEA at IntraLinks.

Hey, don’t blame the messenger!

(Photo: University of North Texas Libraries)