Why does the SP of a takeover company go down?

[Muschu]

Let me display, again, that which I do not know..... I understand why the share price of a company which has been taken over goes up.
However, in my naivety, I would have thought that the takeover company, by its actions, is actually indicating a position of strength in taking over a smaller competitor and that, in so doing, it is actually placing itself in an even stronger position.
As an example, since AGK announced a takeover action its SP has continued to drift south.
Why is it so?

 

[prawn_86]

Probably a multitude of reasons opinions.

Takeover wont go through, therefore have wasted time effort and money in pursuing the bid

Takeover goes through but cannot integrate the 2 co's effectively

etc etc

Basically people being pessimistic about the future because it is unclear...

 

[pacestick]

There is an imediate transfer of wealth from the company making the offer to the shareholders of the company accepting the offer thus in the short term the company making the offer is worth less and the shareholders of the company being bought are worth more. The reason the company making the offer is prepared to put up with this is that they believe long term they will be worth more as the benefits of owning the acquisition flow to them