We document that M\&A withdrawals are more sensitive to acquirers’ announcement returns when the deal is all-cash, suggesting an intriguing interaction between payment methods and market feedback. Motivated by this evidence, we develop a model where managers negotiate over payment methods and learn about deal synergies from post-announcement prices. Our theory identifies two forces---shaping price informativeness and truncating positive NPV projects---through which payment methods affect market feedback and total surplus. We test model predictions on payment method choice in a merger-arbitrageur setting and find supporting evidence.