Evaluating the SDC mergers and acquisitions database

We compare 20 years of data from Thompson Financial SDC Platinum (SDC)'s Mergers and Acquisitions database with a hand-collected database, providing evidence on the completeness and accuracy of SDC data across time. We find that our hand-collected data is generally more accurate than SDC, but SDC's accuracy and coverage improves over time. Our investigation of discrepancies between the databases finds that SDC is more prone to errors on smaller, high book-to-market acquirers with weak announcement period market responses. Preliminary analyses suggest that this potential bias is not significant, but could affect inferences when examining smaller, high book-to-market firms.