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Journal articles on the topic 'Mergers and acquisitions transactions'
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1
Vertakova, Yulia, Inga Vselenskaya, and Vladimir Plotnikov. "Mergers and Acquisitions Risk Modeling." Journal of Risk and Financial Management 14, no. 9 (September 21, 2021): 451. http://dx.doi.org/10.3390/jrfm14090451.
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In the context of the dynamics of the modern external environment, the importance of risk management in general and the risks inherent in the processes of mergers and acquisitions has sharply increased. This is becoming one of the primary challenges in business, the solution of which will contribute to economic growth and development. In this article, based on a broad review of literature, the key risks of mergers and acquisitions are identified and classified, the level of their significance is assessed, the relevant management tools are selected for each risk and a computer program is developed that implements the selection of tools for each specific merger and acquisition transaction. A comprehensive automated methodology for the selection of risk management tools in the implementation of mergers and acquisitions can become an effective risk management tool for companies participating in such transactions. This will allow to identify and track risks in a timely manner, assess their significance, and, among other things, contribute to the adoption of effective management decisions regarding risk management.
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Ahmed, Farhan, Afzal Ahmed, and Sahabia Kanwal. "Mergers and Acquisitions in Selected Frontier Markets of Asia." Signifikan: Jurnal Ilmu Ekonomi 7, no. 1 (January 12, 2018): 123–36. http://dx.doi.org/10.15408/sjie.v7i1.6074.
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This paper aims to provide contemporary and comparative information on mergers and acquisition activities. The findings have shown that Vietnam is very active in mergers and acquisitions activities, for instance in Vietnam 2946 transactions were announced, and 2114 completed in the last decade. Furthermore, Vietnam has a distinctive element of merging local firms; Out of top 20 deals, in 18 transactions target firms and acquirer both were from Vietnam. On the other hand, Sri Lanka has the highest percentage of completed M&A transactions in the last decade compared to Pakistan and Vietnam. In case of Pakistan, the findings suggest that Pakistan has had the highest number of value-based Mergers and Acquisitions deals in comparison to Sri Lanka and Vietnam. Interestingly, even though the number of transactions is higher compared to Sri Lanka and Vietnam; however, mergers and acquisition have had no significant impact on the profitability of Pakistan companies.DOI: 10.15408/sjie.v7i1.6074
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SKALOZUB, Liudmyla. "Merger & acquisition in the banking sector." Economics. Finances. Law, no. 2/2 (February 28, 2020): 19–23. http://dx.doi.org/10.37634/efp.2020.2(2).4.
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Nowadays there is a considerable amount of information in the literature about mergers and acquisitions of companies in various business fields which gives the world economy an incentive for mergers and acquisitions of financial institutions – banks, which, having large assets, control economic processes in individual countries. The article examines the current state of the market of mergers and acquisitions in the banking sector of Europe and Ukraine. The experience of merging banking structures is examined, the advantages and disadvantages of concluding agreements are identified, factors that may trigger merger or acquisition agreements are identified. The purpose of the article is to investigate the processes of mergers and acquisitions of banks in the Ukrainian and European financial markets. The current market conditions dictate strict rules not only for entry, but also for the functioning of banks in their segment. Globalization processes in today's world are one of the prerequisites for increasing the number of mergers and acquisitions concluded in the banking sector. The article examines the current state of the market of mergers and acquisitions in the banking sector of Europe and Ukraine. The experience of merging banking structures is examined, the advantages and disadvantages of concluding agreements are identified, factors that may trigger merger or acquisition agreements are identified. The merger or acquisition agreements concluded on the European banking market have been analyzed. By analyzing the concluded M&A agreements in the European banking market, we can say that the value of such agreements is gradually reduced over the period 2012-2017. The practice of merger and acquisition agreements in the banking sector of Ukraine is analyzed. Crises in the banking sector and the Ukrainian economy as a whole make it possible to say that investors are less interested in the domestic banking system, which indicates that it is impossible to increase the number of mergers and acquisitions of domestic banking institutions. It is worth noting that there are currently about 100 banks in Ukraine that are declared insolvent, and a significant amount of non-performing loans can be a serious deterrent to increasing M&A transactions.
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Розумная, Наталья, and Natalia Rozumnaya. "Features of Personnel Management in the Process of Mergers and Acquisitions." Bulletin of Kemerovo State University. Series: Political, Sociological and Economic sciences 2019, no. 1 (April 18, 2019): 128–34. http://dx.doi.org/10.21603/2500-3372-2019-4-1-128-134.
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The research features personnel management in the process of mergers and acquisitions. The author analyzed the theoretical basis for personnel management in the process of integration and developed a number of practical recommendations. The analysis was based on the following methods: analytical, synthetic, inductive-probabilistic, statistical, and mathematical. The article deals with the theoretical aspects of transactions on the unification of enterprises. It describes the current state of the fast-developing Russian market of mergers and acquisitions, as well as the dynamics of transactions in terms of value and quantity. The study revealed the structure of transactions by sectors in 2017. It also included an analysis of foreign and domestic experience in the management of human resources in the process of merger or acquisition of enterprises. The author describes the main problems of personnel management in the process of unification of companies, as well as various existing methods of labor relations regulation in the process of integration. The conclusion features some recommendations for implementation in practice of the Russian companies.
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Davidson III, Wallace N., Shenghui Tong, and Richard Proctor. "Why bidding firms do not hire financial advisors in mergers and acquisitions." Corporate Ownership and Control 5, no. 3 (2008): 316–23. http://dx.doi.org/10.22495/cocv5i3c2p7.
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In this paper, we examine why some bidders decide not to hire investment bank advisors in M&A transactions. We build a sample of 181 M&A transactions in which the acquiring firms do not hire investment bank advisors, and compare them with a control sample of 181 M&A transactions in which the acquiring firms hire investment bank advisors. We find that the transaction costs are the primary reason that investment banks are hired as advisors for bidders in M&A transactions. In addition, the information asymmetry and contracting costs are the other two reasons that bidders hire investment banks in M&A transactions.
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Sinitsova, Yana S. "CURRENT TRENDS IN INTERNATIONAL MERGERS AND ACQUISITIONS OF PHARMACEUTICAL COMPANIES." International Trade and Trade Policy 7, no. 2 (June 28, 2021): 97–108. http://dx.doi.org/10.21686/2410-7395-2021-2-97-108.
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The article analyzes the results of mergers and acquisitions of global pharmaceutical companies and their impact on the global pharmaceutical industry. The relevance of this research is determined by the high significance of mergers and acquisitions of global pharmaceutical companies on the global pharmaceutical industry and market. A comprehensive approach is used to assess the impact of mergers and acquisitions of pharmaceutical companies on the global pharmaceutical industry. The article presents statistical data on the volume and number of venture investments in the pharmaceutical and biotechnological industries. The reasons for mergers and acquisitions by pharmaceutical companies, as well as the dynamics of the activity of such transactions, are determined. The geographical structure of stock transactions and the total number of mergers and acquisitions of pharmaceutical companies are presented, as well as examples of the largest mergers and acquisitions of pharmaceutical companies.
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Virabyan, S. N. "Measuring the effectiveness of mergers and acquisitions: features of the application of the DEA method." Strategic decisions and risk management, no. 6 (February 13, 2018): 58–65. http://dx.doi.org/10.17747/2078-8886-2017-6-58-65.
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With every year, the application of merges and acquisitions strategy becomes more and more topical for Russian companies. One of the most topical issues is carrying out the analysis of efficiency of M&A transactions that is also confirmed by increasing the number of works in the field of assessment of efficiency of M&A transactions of companies. In this article, the main methods of assessment of efficiency of M&A transactions, and also possibility of use of the DEA method in determining efficiency of transactions of the oil and gas companies are considered for example. The comparative analysis of application of traditional methods and the DEA method using example of an assessment of efficiency of acquisition of JSC Rosneft is carried out. Results of the analysis showed that it is necessary to carry out a complex assessment of productivity of the M&A transaction, using some methods and assessment approaches, since the DEA method not always works in a section of an assessment of efficiency before and after the transaction. So, according to the given calculations, the effect of acquisition in the first year after acquisition was positive (0,001%), but by 2014 became 0,9%. Profitability of assets as started decreasing, and two years later the total change became 5%. Thus profitability of the capital increased in the first year by 26% however in a year this value decreased. At the same time, this method is applicable for an express choice of the companies purposes from a large number of the companies. The sequence of steps is developed for DEA method application in an assessment of efficiency of carrying out transactions on merges and acquisitions, and also a technique of definition of DMU for an assessment of efficiency of one transaction within DEA method use that gives to research the high practical importance. Recommendations about express selection of the companies purposes for carrying out the transaction of M&A are made.
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BEREZOVSKIY, Eduard Eduardovich, Anatolii Aleksandrovich KIZIM, Vladimir Ivanovich GAYDUK, and Vladimir Dmitrievich SEKERIN. "Logistics Tools during Mergers and Acquisitions." Journal of Advanced Research in Law and Economics 8, no. 8 (September 3, 2018): 2354. http://dx.doi.org/10.14505//jarle.v8.8(30).05.
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The article considers basic areas of mergers and acquisitions (M&A) that are peculiar of modern companies based on logistics tools as auxiliary elements when planning various stages of preparing, carrying out and completing the integration or corporation. On this basis modern understanding of the M&A changes both globally and regionally is formed. The article pays special attention to the control over M&A transactions through the efficient implementation of logistics in intercompany processes of various business structures regardless of the scale and sector. It defines modern trends on accelerating M&A transactions in various areas (financial, industrial, energy) based on the extended tools of generally accepted approaches that make it possible to maximize the synergetic effect.
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Jayasuriya, Dulani, and Ben O’Neill. "Social Media’s Impact on the Global Mergers and Acquisitions Market." Journal of Risk and Financial Management 14, no. 4 (April 2, 2021): 157. http://dx.doi.org/10.3390/jrfm14040157.
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This study analyses the impact of social media popularity on the global mergers and acquisitions (M&A) market using a sample of 66,905 M&A transactions across 50 countries for the sample period from 2011 to 2017. Social media influence on M&A transactions is tested using competing bids and proportion of cash paid in the transaction deal characteristics. We find that social media popularity has increased the probability of competing bids by 7.7% across countries and the proportion of cash paid in transactions decreased by 2.5% across countries. The results of additional analyses using the introduction of the internet are consistent with the conclusion that technologies that enhance the transmission of public information have an effect on the M&A variables tested. We test the robustness of our results using subsample analysis and placebo tests. This study is distinct from existing literature due to its globally diverse M&A dataset, unique social media and internet data, and cross-country approach to social media’s influence on financial markets.
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Varvus, S. A., and A. P. Buevich. "Mergers and acquisitions in developed countries in the modern economy: A country comparative analysis." Economic Analysis: Theory and Practice 19, no. 6 (June 29, 2020): 1084–100. http://dx.doi.org/10.24891/ea.19.6.1084.
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Subject. Of the two options, i.e. the development of own production or merger (acquisition), many companies choose the latter. However, it entails numerous risks. According to experts, two-thirds of all mergers and acquisitions would be eventually unprofitable. Therefore, it is necessary to estimate potential benefits prior to initiating the process. The article investigates the role of mergers and acquisitions in social reproduction. Objectives. We analyze the Russian M&A market and reasons for its development. Methods. The study employs methods of regression analysis and comparative analysis. Results. We calculated the correlation coefficient by the indicators of the stock market capitalization and the valuation of M&A transactions for the Russian and the U.S. economy. Conclusions. The Russian M&A market structure shows the predominance of acquisitions. The Russian stock market is characterized by low level of development as compared to Western markets; securities of the Russian market should not be considered as a liquid payment instrument over the long term.
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Srbinoska, Dusica Stevcevska. "The Strategic Integration of Enterprises as Determinant Of Merger and Acquisition Success." International Journal of Accounting and Financial Reporting 6, no. 2 (October 4, 2016): 190. http://dx.doi.org/10.5296/ijafr.v6i2.9739.
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Mergers and acquisitions are driven by the same motive: synergy creation and realization of larger value by combining companies. However, numerous merger and acquisition efforts show a lack of critical success elements: attention directed towards integration of employees and work processes. In this research, I focus on analysis of the meaning of post-transactional integration of mergers and acquisitions as a determinant to the business deal success, with particular emphasis on the Republic of Macedonia. The success of the merger i.e. acquisition act depends on how the deal is conducted, i.e. on the success of the integration process, which I demonstrate through a field research across several Macedonian enterprises.
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Pazarskis, Michail, George Drogalas, Alkiviadis Karagiorgos, and Efthalia Tabouratzi. "Greek banking sector in the economic crisis and M&As as a solution." Corporate Board role duties and composition 15, no. 2 (2019): 37–44. http://dx.doi.org/10.22495/cbv15i2art4.
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This study examines the impact of thirteen mergers and acquisitions in the Greek banking sector which took place during the period of economic crisis: 2008-2014. More specifically, the sample of this study consists of all the mergers and acquisitions that led to the four remaining Greek banks (the acquirers of the above-mentioned transactions) which are: National Bank of Greece, Piraeus Bank, Eurobank and Alpha Bank. These specific banks were chosen due to the fact that after the M&As transactions we were able to compare their financial data. This comparison was made by using eight ratios for statistical tests one-year pre- and post-merger. The results of the study indicate statistically significant improvement in three capital structure and viability ratios, as well as a slight improvement on a liquidity ratio, while there is statistically insignificant change or no improvement on the profitability and efficiency ratios. In conclusion, there was some improvement in terms of capital adequacy and loan structure as far as the total capital employed of the merged institutions is concerned, but without improving the profitability of the banks during the economic crisis in Greece.
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Kim, Sungmin. "Personal Information Issues in Mergers and Acquisitions Transactions." Justice 165 (April 30, 2018): 71–125. http://dx.doi.org/10.29305/tj.2018.04.165.71.
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Aleksandrov, Igor, Marina Fedorova, and Aleksey Parshukov. "Effectiveness of integration transactions of companies in the environmental sector." E3S Web of Conferences 244 (2021): 10048. http://dx.doi.org/10.1051/e3sconf/202124410048.
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This article is aimed at improving the processes of evaluation by enterprises of the agro-industrial complex of planned decisions on acquisitions and mergers. The work is based on the analysis of integration evaluation problems, known approaches to their solution, and the development of the conceptual framework for evaluating these transactions. The article offers a method developed by the authors to assess the effectiveness of merger processes. The proposed method for evaluating mergers is developed on the basis of assessing the change in the company’s potential after the merger. The assessment of potential changes resulting from the implementation of integration projects will allow assessing the economic impact of merger options, taking into account the environmental consequences for the territory. The proposed method is aimed at more accurate accounting of changes in the intangible assets of the combined company as a result of integration. Rationalizing the evaluation of the effectiveness of mergers will allow the owners of the evaluated companies to improve the quality of preparation of integration transactions and reduce the risks of making inefficient decisions.
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Phakeng, M. "REGULATION OF MERGERS AND ACQUISITIONS IN TERMS OF THE SOUTH AFRICAN COMPANIES ACT 71 OF 2008: AN OVERVIEW." BRICS Law Journal 7, no. 1 (March 8, 2020): 91–118. http://dx.doi.org/10.21684/2412-2343-2020-7-1-91-118.
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The Companies Act 71 of 2008 (the 2008 Act) replaced the Companies Act No. 61 of 1973, effective 1 May 2011. The 2008 Act was aimed at keeping pace with developments in company law internationally. It is not intended to entirely replace the well-established principles and has largely retained the pre-existing South African company law. The mergers and acquisitions provisions are aimed at creating transparent, efficient, and simple procedures. Different types of mergers and acquisitions are clearly defined as “affected transactions” or “offers” in section 117. Section 118 provides for companies to which the provisions apply. The reasons for regulating these transactions and powers of the regulator – The Takeover Regulation Panel, have been reviewed, clarified, and improved. The previous section on disposal of all or greater part of assets or undertaking of a company has been re-written. The 2008 Act further introduces a new type of affected transaction in section 113, in the form of a “merger” or an “amalgamation.” The 2008 Act has retained the scheme of arrangement in section 114, but has changed its format by removing compulsory court application and approval. The courts get involved under certain prescribed circumstances. The 2008 Act has enhanced shareholder protection for fundamental transactions in the form of section 164 – Appraisal Rights and section 115, dealing with shareholder approval of fundamental transactions. Some scholars and practitioners have criticised certain provisions. However, in general, the provisions have received favourable commentary. They regarded as progressive and comparable with others internationally.
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Bakerjian, Leen. "Cross-Border Mergers and Acquisitions in Light of the European Legal Framework." Debreceni Jogi Műhely 18, no. 1-2 (September 1, 2021): 1–12. http://dx.doi.org/10.24169/djm/2021/1-2/1.
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This paper will discuss the role that Mergers and Acquisitions play in the global economy. It will deliberate on the challenges, benefits and issues of the implementation of these transactions in terms of legality, society and culture. It also contains an empirical enquiry that investigates the application of Mergers and Acquisitions in the presence of different social and cultural working environments. It also demonstrates attempts of entering into such transactions with incorrect intentions such as domination and the negative outcomes of such approach.
Throughout this work, I will investigate the legal instruments governing these types of transactions in different areas of the world, specifically the European Union. It will touch on the legal instruments governing Mergers and Acquisitions in the European Union and will challenge the applicability of the fundamental freedoms of the European Union in light of the cross-border Mergers and Acquisitions directives. The paper will challenge the European Court of Justice’s approach to the Freedom of Establishment and the application of cross-border M&As.
Finally, a clear demonstrateion of the fallbacks of the provisions of the Cross-Border Mergers Directives is provided as well as challenging the European legislature’s choices in drafting said directives. Unusual discrepancies between the directives and the fundamental freedoms of the European Union are shown, however these two which must always be in line with one another.
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Duksaitė, Eglė, and Rima Tamošiūnienė. "Why Companies Decide to Participate in Mergers and Acquisition Transactions." Mokslas - Lietuvos ateitis 1, no. 3 (April 11, 2011): 21–25. http://dx.doi.org/10.3846/145.
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The article describes the most common motives for companies’ decision to participate in mergers and acquisitions’ transactions. It underlines the importance of the growth factor, whereas the following factors – namely, synergy, diversification and so on – just support the growth motive. Since mergers and acquisitions involve two different parties – the buyer and the seller – the examples of reasons from both perspectives are provided too.
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Voskanian, R. O. "Analysis of the russian market of mergers and acquisitions." Russian competition law and economy, no. 2 (June 30, 2020): 58–63. http://dx.doi.org/10.32686/2542-0259-2020-2-58-63.
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The subject of the research is the Russian market of mergers and acquisitions in the period from 2009 to 2019. The author has examined the economic essence of mergers and acquisitions, analysed the number of transactions of both types on the Russian market. The article analyses foreign participation in the Russian market of mergers and acquisitions reveals a tendency to its linear decline from 2011 to the present. Also were identified three sectors of the Russian economy leaders in the number of target companies (banks, agriculture, transport and infrastructure). A conclusion has been formulated on the negative impact of the current economic situation on the Russian and global market for mergers and acquisitions, suggesting a decrease in the number and amount of mergers and acquisitions in the coming years.
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Ochirova, Elena. "Literature Review of Mergers and Acquisitions with the Aim to Obtain Technology and Knowledge." Journal of Corporate Finance Research / Корпоративные Финансы | ISSN: 2073-0438 13, no. 4 (December 30, 2019): 87–94. http://dx.doi.org/10.17323/j.jcfr.2073-0438.13.4.2019.87-94.
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Technological transformation of the economy is pushing companies to create or improve their technological capabilities. One of the ways to acquire technology and knowledge that allows companies to remain competitive is mergers and acquisitions (M&A). The efficiency and motives of M&A transactions with motivation of obtaining new technology and knowledge are the subject of a large number of studies. The contradictory results of studies of technological M&A transactions can be explained by the gaps of the empirical analysis or the weakness of the theoretical knowledge. The purpose of this study is to review the theoretical works on the effectiveness of M&A transactions in order to acquire technology and knowledge, and to identify the main results in this area. In particular, the motives of technological M&A deals were identified; the technological overlap of the parties of the M&A transactions and the relationship between the intensity of R&D expenses, innovative activity and company efficiency were described. In order to identify the relevant key determinants of the effectiveness of technological M&A transactions the motives of traditional M&A transactions were also examined. As a result of the analysis, it was revealed that the technological similarity between the acquiring and acquired companies have positive effect on the reaction of investors and on the effectiveness of the transaction, however, it negatively affects the overall effectiveness of the buyer company. The intensity of R&D expenses and innovative activity demonstrate inconsistent results on companies’ performance. Factors that have direct or indirect impact on the integration between companies - have contradictory results on both parties of a deal. Based on the existed literature the effectiveness of M&A transactions with the aim of acquiring technology and knowledge is associated with uncertainty for investors caused by the risks of such transactions in different sectors of the economy, the motives of managers and the characteristics of the parties of the transactions.
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Dąbkowska, Anna. "Fuzje i przejęcia w niemieckim sektorze bankowym w latach 1997–2012." Zeszyty Naukowe SGGW - Ekonomika i Organizacja Gospodarki Żywnościowej, no. 110 (July 15, 2015): 155–65. http://dx.doi.org/10.22630/eiogz.2015.110.26.
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Deepening globalisation and liberalisation on the market of banking services make banks worldwide concentrate their capitals. Carefully planned mergers and acquisitions within financial sector are supposed to rise the scale of the businesses and increase their values. This paper is aimed at presenting mergers and acquisitions in German banking sector, focusing only on transactions within particular sub-sectors of German banking system. The analysis covered consolidation processes of all sub-sectors of German banking sector. The most important mergers and acquisitions observed since the financial crisis were presented.
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Bathelt, Harald, and Sebastian Henn. "Knowledge exchanges, trust, and secretive geographies in merger and acquisition processes." Environment and Planning A: Economy and Space 53, no. 6 (May 31, 2021): 1435–53. http://dx.doi.org/10.1177/0308518x211013360.
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Our current understanding of knowledge generation over geographical distance relies heavily on studies that focus on producer–user or headquarter–subsidiary settings. Less attention has been paid to the geographical particularities of knowledge exchanges in mergers and acquisitions, which involve high costs and an extraordinary degree of risk and uncertainty with potentially significant (positive or negative) consequences for the respective firms and regions alike. To keep the risks associated with such complex long-distance transactions at bay, buying firms strongly depend on robust knowledge about the structure and value of the target units while the sellers require reliable knowledge about the goals of the acquisition and the price the buyer is willing to pay. This paper aims to investigate the spatiality of related knowledge exchanges during merger and acquisition procedures by analyzing the role of face-to-face contacts and investigating the mechanisms to establish trust in undertaking such risky endeavors. Our empirical analysis focuses on national and international corporate acquisitions and takeovers involving firms located in Germany. It is based on semi-structured in-depth interviews with actors involved in mergers and acquisitions, conducted since 2012. We distinguish between the two extremes of relational and auction-based merger and acquisition procedures and systematically analyze in a process perspective (a) the conditions under which knowledge is exchanged over distance, (b) the importance of temporary proximity and how secretive geographies of meetings evolve, and (c) the ways in which trust is created and uncertainties are reduced.
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Aleksandrov, Igor, Marina Fedorova, and Aleksey Parshukov. "Effectiveness of mergers and acquisitions for agribusiness companies." E3S Web of Conferences 217 (2020): 09001. http://dx.doi.org/10.1051/e3sconf/202021709001.
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This research is aimed at improving the efficiency of evaluating mergers and acquisitions for companies in the agro-industrial complex. When evaluating these transactions, it is necessary to take into account their impact on the environment. The paper analyzes the problems associated with the evaluation of these transactions and identifies ways to improve the evaluation methods. The authors ‘ approach to evaluating acquisitions based on the assessment of changes in the company’s potential is intended to improve the accuracy of the assessment and reduce the risks of revaluation of discounted cash flow from acquisitions. Assessment of potential changes as a result of the implementation of integration projects will allow assessing the economic impact of takeover options, taking into account the environmental consequences for the territory. The proposed approach is aimed at more accurate accounting for changes in intellectual capital of the combined company as a result of integration. Rationalization of the evaluation of the effectiveness of acquisitions will allow owners and management of agro-industrial companies to reduce the risks of making ineffective decisions.
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Xu, Xin, Yong-jin Liang, and Shun-lin Song. "WHAT DRIVES MERGERS & ACQUISITIONS WAVES OF LISTED COMPANIES OF THE CHINEXT MARKET? IPO OVER-FINANCING OR STOCK OVERVALUATION." Technological and Economic Development of Economy 24, no. 4 (August 14, 2018): 1499–532. http://dx.doi.org/10.3846/tede.2018.3762.
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A wave of mergers and acquisitions (M&A) has been consistently rising among the China’s ChiNext companies over the past years, which has drawn great attention across academia and industry. Based on the neoclassical theory and the behavioral theory, this paper explores the driving factors of M&A among Chinese ChiNext companies. Two hypotheses were put forward: one based on IPO over-financing and the other based on the market value overvaluation. IPO over-financing is specific to the Chinese capital market while market value overestimation is driven by the continuous upsurge in the ChiNext Market. Our study found that both factors account for enterprises’ mergers and acquisitions. They have far-reaching influences on such fields as acquisition probability, the size of the transaction, transaction frequency, M&A payment method and market reaction. Due to IPO over-financing, enterprises tend to carry out M&A via cash payment or cash and stock mixed payment method. Heavier IPO over-financing will increase the chance of M&A and leads to larger transaction size and higher transaction frequency. Market value overvaluation will lead to more uses of stock or cash and stock mixed payment on M&A transactions. When the company’s stock is overvalued, the company will use the overvalued equity to acquire other companies. Greater overvaluation of the market value also increases the chance of M&A and leads to a larger transaction size and higher frequency of M&A. In China, IPO over-financing rather than market value over-valuation, is the major driving factor for China’s corporate mergers and acquisitions. Further study found that the market reaction to different payment methods in mergers and acquisitions varies: it has the minimum reaction on cash payment, a larger reaction on stock payment and the greatest reaction on mixed payment. Also, the mixed payment method has the largest cumulative abnormal returns. This is different from the empirical findings in the United States and Europe. This paper provides a theoretical basis and empirical evidence for an in-depth understanding of the wave of mergers and acquisitions of Chinese ChiNext companies, and provides a basis for decision-making and policy recommendations for the government regulators and investors.
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Burke, Declan, and Serhiy Kovela. "ITMA - IT Integration in Mergers and Acquisitions." International Journal of Business and Management 12, no. 11 (October 18, 2017): 16. http://dx.doi.org/10.5539/ijbm.v12n11p16.
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This study aims to identify key information technology (IT) integration issues experienced during mergers and acquisitions (M&A) in the financial services sector. The study proposes an approach to increase the efficiency of such transactions. A comprehensive literature review and case study of a leading financial services organisation is undertaken, comprising of interviews with high ranking IT and business leaders. This research identifies the blueprint for a best practice framework, which Chief Information Officers (CIOs) and IT practitioners can employ to guide execution of their own M&A integration programme.
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Dao, Mai Anh, Andreas Strobl, Florian Bauer, and Shlomo Y. Tarba. "Triggering Innovation Through Mergers and Acquisitions." Group & Organization Management 42, no. 2 (March 21, 2017): 195–236. http://dx.doi.org/10.1177/1059601117696573.
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In this article, we analyze how shared team and task mental models, developed prior to an acquisition, affect exploration and exploitation activities in the postacquisition phase, and how these effects are dependent on relative size. With a sample of 101 transactions of acquirers from the German-speaking part of Europe, we provide empirical evidence that both shared team and task mental models positively influence exploitation activities following an acquisition, whereby only shared team mental models (TMMs) are beneficial for exploration. We provide empirical evidence that shared mental models in terms of task and team are an important informal source for enhancing exploration and exploitation innovation activities. However, this source of informal coordination is contextual. Although the relationships on exploitation are stable, the beneficial effect of TMMs on exploration is sensitive and devitalized by an increasing relative size. Implications for further research and management practice are given.
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Dereeper, Sébastien, and Aymen Turki. "Dividend policy following mergers and acquisitions: US evidence." Managerial Finance 42, no. 11 (November 14, 2016): 1073–90. http://dx.doi.org/10.1108/mf-10-2015-0293.
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Purpose The purpose of this paper is to address whether the past dividend policy of target firm impacts dividend policies following US mergers and acquisitions (M&A). Design/methodology/approach The authors use the catering theory as a theoretical approach to test dividend change after a merger-acquisition. For the empirical design, dividend policy is captured using dividend status, payout ratio and dividend yield, and specifications are estimated using Probit and OLS models. Findings The data indicate that dividend policy of the target affects dividend policy of the combined entity in cases of stock-based deals. This result provides support for catering theory, which maintains that managers of acquirers adjust dividend policies following transactions to cater to target shareholders’ preferences. Research limitations/implications Although the tests suggest significant results using dividend status and payout ratio as measures of dividend, the authors do not find a similar effect for dividend yield. Practical implications Financial analysts evaluating merger-acquisition announcements may wish to predict the dividend policy following stock-based deals as they project the likely impact of past dividend policies of target firms. The results are also likely to be useful to investors. Originality/value The paper presents new evidence about dividend policy following M&A. To the authors’ knowledge, this is the first study that examines how an acquirer’s dividend policy is affected by an acquisition.
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Смирнов, Андрей Владимирович. "THE MARKET STRUCTURE: ANALYSIS OF APPROACHES APPLICABLE TO THE RUSSIAN MARKET." Вестник Тверского государственного университета. Серия: Экономика и управление, no. 3(51) (October 22, 2020): 50–58. http://dx.doi.org/10.26456/2219-1453/2020.3.050.
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Статья посвящена проблеме интеграции методологии анализа трансакционных издержек в общий анализ сделок по слияниям и поглощениям компаний. В условиях усиливающейся конкуренции на международном рынке наукоемких технологий, в целях экономии времени крупные компании вынуждены приобретать сложившиеся коллективы высококвалифицированных специалистов через слияния и поглощения. Однако такая процедура характеризуется высоким порогом экономически неэффективных сделок, что снижает конкурентоспособность всей отрасли. Целью исследования является анализ критериев оценки эффективности стратегии M&A. Научная новизна заключается в синтезе институционального и бухгалтерского подходов, позволяющего сделать вывод, что слияние и поглощение компаний является не просто переходом работников или имущества из одной фирмы в другую, это еще и изменение трансакций, а значит и трансакционных издержек, анализ которых в подавляющем большинстве вымывается при исследовании таких сделок. The article is devoted to the problem of integrating the methodology of analysis of transaction costs into the general analysis of mergers and acquisitions of companies. In the face of increasing competition in the international market for knowledge-intensive technologies, in order to save time, large companies are forced to acquire established teams of highly qualified specialists through mergers and acquisitions. However, this procedure is characterized by a high threshold of economically inefficient transactions, which reduces the competitiveness of the entire industry. The purpose of the study is to analyze the criteria for evaluating the effectiveness of the M & A strategy. The scientific novelty lies in the synthesis of institutional and accounting approaches, which make it possible to conclude that the merger and takeover of companies is not just a transfer of workers or property from one firm to another, it is also a change in transactions, and therefore transaction costs, the analysis of which is overwhelmingly washed out when studying such transactions.
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Walsh, Philip R., and Olalekan Ajibade. "Determining the efficacy of consolidating municipal electric utilities in Ontario, Canada." International Journal of Energy Sector Management 13, no. 2 (June 3, 2019): 298–317. http://dx.doi.org/10.1108/ijesm-07-2018-0017.
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Purpose This paper aims to examine empirically if the encouragement by government policy of merger and acquisition activity involving municipal and provincially owned electricity distribution utilities (LDCs) in the Province of Ontario has had positive effects in terms of value creation, operating performance and economies of scale. Design/methodology/approach It was anticipated that with LDC consolidation, there will be increased operational efficiency and improvement in the cost-effectiveness of the merged electrical utility. Using matched pairs dependent t-testing and Wilcoxon signed-rank testing, the authors compared data for three years before and after the merger or acquisition of 16 municipal utilities (616 total observations) to determine if there were any statistically significant changes (positive or negative) in measures of financial, operational and service efficiency. Findings The findings indicate statistically significant increases in debt as a percentage of shareholder equity in post-merger/acquisition utilities and consequently leveraged higher returns on equity. However, there were no statistically significant changes in financial, operational or service efficiency measures (with the exception of decreased efficiency in telephone response). Research limitations/implications A total of 16 mergers or acquisitions were reviewed involving 32 of 79 LDCs, with the research implications pointing to a need for existing policy to be reviewed to determine whether a more detailed examination is required by the provincial energy regulator, including a closer examination of managerial motives, before approving mergers between municipal electricity distributors. This research involves only a quantitative approach and further research would examine these transactions using qualitative measures for a deeper examination as to managerial motives. Practical implications The results suggest that the mergers or acquisitions to date have served only to increase shareholder risk without improvement in other financial, operational or service efficiencies, a contradiction to the rationale behind the Province’s merger policy. Social implications The consolidation policy for Ontario LDCs has not resulted in any statistically significant improvement in electricity rates or service for consumers. Originality/value This paper is the first examination of the effects of Ontario’s LDC consolidation policy in terms of specific financial, operational and service efficiency measures.
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Diaz, William. "Common US immigration consequences of mergers and acquisitions." Human Resource Management International Digest 23, no. 7 (October 12, 2015): 42–45. http://dx.doi.org/10.1108/hrmid-07-2015-0132.
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Purpose – Observes that, with increasing federal scrutiny and the risk of raids, fines and even prosecution, businesses engaged in mergers and acquisitions must ensure that violations of US immigration law are minimized through due diligence and planning. Design/methodology/approach – Examines the common US immigration consequences of mergers and acquisitions under the sub-headings of ensuring I-9 compliance; preserving qualifying corporate relationships for L-1A/L-1B intra-company transferees; retaining current H-1B visa employees; corporate ownership and maintaining eligibility for E-1/E-2 visas; and employees awaiting legal permanent resident status. Findings – Shows that, while there are a number of US immigration consequences that flow from a merger or acquisition, critical considerations include the effect on current employees; ease of future global mobility in hiring and transferring personnel; and compliance to avoid fines and other sanctions. Practical implications – Argues that failure to adequately consider US immigration consequences can prove costly, as foreign employees may face inconvenient limitations or outright termination of their ability to work in the USA on the basis of changes in corporate structure, ownership or occupation. Social implications – Draws attention to the fact that, in the midst of a merger or acquisition, US immigration matters are often an afterthought to be addressed by in-house counsel lacking immigration expertise, or by outside immigration counsel potentially engaged late in a transaction. Originality/value – Concludes that the consequences of mergers and acquisitions affect current personnel, global mobility of future hires and liabilities pertaining to regulatory compliance. As a result, due diligence and early involvement of qualified US immigration counsel are critical to ensure a smooth transition for businesses and employees alike.
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Aleksandrov, Igor, Marina Fedorova, and Aleksey Parshukov. "Evaluating the effectiveness of mergers and acquisitions for agribusiness companies." E3S Web of Conferences 203 (2020): 05016. http://dx.doi.org/10.1051/e3sconf/202020305016.
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This research is aimed at improving the efficiency of evaluating mergers and acquisitions for companies in the agro-industrial complex. When evaluating these transactions, it is necessary to take into account their impact on the environment. The paper analyzes the problems associated with the evaluation of these transactions and identifies ways to improve the evaluation methods. The authors ' approach to evaluating acquisitions based on the assessment of changes in the company's potential is intended to improve the accuracy of the assessment and reduce the risks of revaluation of discounted cash flow from acquisitions. Assessment of potential changes as a result of the implementation of integration projects will allow assessing the economic impact of takeover options, taking into account the environmental consequences for the territory. The proposed approach is aimed at more accurate accounting for changes in intellectual capital of the combined company as a result of integration. Rationalization of the evaluation of the effectiveness of acquisitions will allow owners and management of agro-industrial companies to reduce the risks of making ineffective decisions.
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Hýblová, Eva, Jaroslav Sedláček, and Zuzana Křížová. "Development of mergers in the Czech Republic in 2001–2010." Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis 60, no. 4 (2012): 133–40. http://dx.doi.org/10.11118/actaun201260040133.
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One of consequences of the substantial market globalization is company transformations, which essentially affect the creation, existence or dissolution of companies; their number has been on the increase in recent years. They are mergers and acquisitions; mergers represent a combination of companies, whereas acquisitions involve selling, purchase or investments of companies. The main reason for a merger is economic growth which can be provided in various ways: these are e.g. decreases in costs, strengthening of a position in the market or access to new markets, decrease in prices and thus gaining new customers, access to knowledge or diversification of risks.The process of a merger is a highly demanding matter which includes the economic view (a choice of the right partner, setting merger objectives, preparation of merger project) and the legal view as the merger involves commercial law, reporting and taxation legislation. Discrepancies in the legal, reporting and taxation procedures in the area can have a negative effect on the process of merger and economic practice. The development of mergers and acquisitions and their success rate is related to the development of the economic and legislative environment. An important aspect is also the successfulness of mergers in the following year which will confirm (or not) the quality of all previous decisions.Research studies conducted in this field focus on mergers with the aim to evaluate procedures during mergers. An important part of research is an analysis of the effect of a merger on the evaluation of the successor company’s performance, changes in capital and capital structure of the entities. The aim of the paper is to publish first partial results in this direction of research. The first part of the research focuses on the creation of a database of companies as this is essential for practical verification of the results of the theoretical research. Due to the fact that there is no similar official statistics in the Czech Republic, its creation needs to be devoted great attention. It is also vital to define the transactions which will be included in the total number so that the results are relevant.
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Ptashchenko, O. V. "Features of «Mergers» and «Acquisitions» of Companies in International Business." Business Inform 1, no. 516 (2021): 34–39. http://dx.doi.org/10.32983/2222-4459-2021-1-34-39.
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The publication presents features of the modern mergers and acquisitions (M&A) process. It should be noted that in the modern world, with the growing global competition, aggressive policies of individual market participants, rapid technological changes, financial regulation and the changing role of the State in the economy, there is a need to expand the activities of large companies. The majority of the most successful companies choose the joint mode of development, such as mergers and acquisitions. As a result of mergers and acquisitions, business will grow and become more influential, and not only national governments, but also international economic organizations will not be able to depend on regulation and management. Today, among the leading domestic or foreign economists there is no consensus on the definition of the concepts of «mergers» and «acquisitions», which is explained by the diversity and complexity of the nature of these processes. The main types of these processes have been identified and their characterizations are provided. When researching the processes of mergers and acquisitions of enterprises, their main differences are determined. It is proved that in an ever-changing market, increased competition and well-thought-out and well-made transactions on international mergers and acquisitions can significantly increase the value of companies. At the present stage, international mergers and acquisitions occupy strong positions in the policy of private companies as the main strategic instrument for business development.
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Srbinoska, Dushica Stevchevska. "Due Diligence Driving the Success of Mergers and Acquisitions in Macedonia." International Journal of Accounting and Financial Reporting 6, no. 2 (August 3, 2016): 1. http://dx.doi.org/10.5296/ijafr.v6i2.9618.
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The act of due diligence is of vital importance when considering the possibility to enter the Macedonian market through merger and/or acquisition transactions. In this paper, I discuss that due diligence helps reduce potential risks or even results with curtailing the transaction as most of the Letters of intent never come to life. Many Macedonian entities, both public and private, operate in an environment considerably different to the European Union economies, a fact that inspires many questions with potential investors, especially in those who come from the European Union. If proper preparation takes place, and the expectations and processes are duly taken into account, successful merger and/or acquisition can be conducted in the Republic of Macedonia in spite of facing numerous difficulties. Finally, I discuss that several suggestions/factors can maximize the chances of success, demonstrated with the example of due diligence process set-up prior to the one.Vip merger that marked the Macedonian communications industry in 2015.
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Bessler, Wolfgang, David Kruizenga, and Wim Westerman. "Stock Market Reactions to Financing and Payment Decisions for European Mergers and Acquisitions." Central European Review of Economics and Management 4, no. 2 (June 3, 2020): 41–89. http://dx.doi.org/10.29015/cerem.868.
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Aim: We analyze stock market reactions to merger and acquisition announcements for firms in Europe and contribute to the literature by providing empirical evidence how the decisions with respect to alternative financing sources (equity or debt) and the methods of payment (cash or stock) affect the magnitude of the valuation effects.
Research design: An event study methodology is applied to 717 M&A transactions. We analyze the size of the cumulative abnormal returns using the financing sources and payment methods and other variables as the relevant determinants.
Findings: The cumulative abnormal results suggest that target shareholders and bidder shareholders in private deals benefit from mergers and acquisitions. The effect found is centered around the announcement date, making our findings consistent with market efficiency. Debt financed deals outperform equity financed deals and cash paid M&A outperform stock paid M&As, due to information asymmetry, signaling and agency effects.
Originality: This study adds to our understanding of the relevance of the financing sources and the payment methods for mergers and acquisitions in Europe.
Implications: This study may help practitioners to better assess the valuation effects of alternative financing sources and payment methods when acquiring other firms.
JEL: G32, G34
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Hsu, Ching-Chiu, Jeong-Yang Park, and Yong Kyu Lew. "Resilience and risks of cross-border mergers and acquisitions." Multinational Business Review 27, no. 4 (December 9, 2019): 427–50. http://dx.doi.org/10.1108/mbr-05-2019-0035.
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Purpose In cross-border mergers and acquisitions (M&As), acquirers often fail to achieve the expectations they held when they made the M&A deals. This paper aims to propose that the risks of cross-border M&As can be mitigated by building and cultivating organizational resilience as a prime means of risk management. Design/methodology/approach The research examines risks associated with cross-border M&A and how such risks can be mitigated by developing resilience. It presents dual cases of acquisitions of the biggest branded mobile phone manufacturer in Taiwan. Findings The authors find that the acquirer faces multiple risks in cross-border M&A transactions, including financial, strategic and organizational, and process risks that arise from misalignment between the goal of the M&As and the post-acquisition performance of the target firms. Originality/value The research provides theoretical insights on organizational resilience and how it can mitigate the specific risks involved in cross-border M&As, thereby developing coherent organizational resilience processes.
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Bick, Patty, Matthew D. Crook, Andrew A. Lynch, and Brian Walkup. "Proximity to urban centers in mergers and acquisitions." Managerial Finance 43, no. 11 (November 13, 2017): 1292–308. http://dx.doi.org/10.1108/mf-01-2017-0014.
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Purpose The purpose of this paper is to examine the impact firm proximity to financial centers has on announcement returns and time to deal completion for mergers and acquisitions. Design/methodology/approach Using a data set of merger and acquisition activity from 1986 to 2014, target and acquiring firms are classified as rural or urban based on their geographic proximity to major financial centers. The impact of this proximity on short-term acquisition announcement returns and on the amount of time required to complete the transaction are tested. Findings Markets react more favorably to the acquisition of firms headquartered in a rural area, likely due to increased information advantage on the part of the acquiring firm. Furthermore, the acquisition of a rural firm requires greater time to completion. Practical implications Acquiring firms may be able to use information asymmetry to their advantage when acquiring firms located in a more rural setting with higher levels of information asymmetry. However, this requires the acquiring firm to generate an informational advantage and will also require a greater time commitment on average to complete the deal. Originality/value While prior literature has demonstrated that the distance between target and acquirer can affect acquisition returns and time to deal completion, this study adds to the literature by demonstrating that the geographic location of the target firm relative to major financial hubs can have a unique effect on mergers and acquisitions as well.
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Dixon, William E., and Thomas P. Flannery. "Retention Incentives: An Emerging Strategy in Today’s Tax-Exempt Organization." Compensation & Benefits Review 50, no. 2 (April 2018): 114–18. http://dx.doi.org/10.1177/0886368719840903.
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Mergers and acquisitions have become a regular activity in health care. Ensuring executive continuity is a prime issue especially given the number of proposed transactions that do not reach completion. For those transactions that are successful, retention arrangements are implemented to promote leadership stability by mitigating both organizational and personal risk. We provide an analysis of these arrangements and market practice.
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Bartov, Eli, C. S. Agnes Cheng, and Hong Wu. "Overbidding in Mergers and Acquisitions: An Accounting Perspective." Accounting Review 96, no. 2 (May 21, 2020): 55–79. http://dx.doi.org/10.2308/tar-2018-0260.
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ABSTRACT Does accounting regime play a role in the well-documented phenomenon of overbidding in M&As? The 2001 regulatory change from a goodwill amortization to a non-amortization regime (SFAS 142) affords us a quasi-experimental setting for testing the consequences of M&A accounting rules for acquirers' bidding decisions. Relying on a novel approach to modeling optimal bidding, our primary finding indicates a significant increase in overbidding in the post-2001 period, suggesting that M&A accounting has real consequences for bidding decisions, and that this result is robust to a battery of sensitivity tests. In addition, supplementary tests show that overbidding is more pronounced in pooling versus purchase transactions, and that the accounting regime's implications for overbidding and acquisition premium are distinct. Overall, our findings shed light on the role accounting plays in shaping managerial decisions—and, ultimately, shareholder wealth—in an important corporate setting. They may thus inform researchers, corporate boards, and standards setters. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: G34, M41.
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Фролова, Марина, and Marina Frolova. "The Russian Market of Mergers and Acquisitions." Servis Plus 8, no. 1 (March 15, 2014): 76–83. http://dx.doi.org/10.12737/2800.
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The article investigates the trends in the Russian market of mergers and acquisitions (M&A) over the last decade. It provides a list of problematic aspects of the legislation of the Russian Federation in the sphere of state regulation of financial markets, the methodology of evaluation and corporate management affecting the number of transactions and the global market. The article analyses the dynamics in the number and value of deals of the Russian market of mergers and acquisitions in the period from 2003 to 2012. The author compares the value of Russian, USA and European markets during the analyzed period. The comparison involves the dynamics of the share of the Russian market and the market share dynamics in Europe, the USA and other countries in the framework of global mergers and acquisitions market. The article defines the similarities that M&A market trends in Russia, USA and Europe show and the discrepancies between the peak and trough periods for the Russian market value and for the market value of other countries, especially the BRICS countries. The article also researches the Russian market and sample Russian industry markets during the global financial crisis of 2008, in the immediately preceding and the following years. The peculiarities of the Russian market are identified, as well as the trends similar to those identified and described in the American research methodology in markets of mergers and acquisitions, with the research aiming at the selection of target companies that maximize the value of the acquiring company.
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Choi, Jongsoo, and Jeffrey S. Russell. "Economic gains around mergers and acquisitions in the construction industry of the United States of America." Canadian Journal of Civil Engineering 31, no. 3 (June 1, 2004): 513–25. http://dx.doi.org/10.1139/l04-004.
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As waves of mergers and acquisitions (M&A) have swept over American industrial business organizations, construction firms have been caught in the middle of the resulting turbulence. Nonetheless, no research has investigated these significant events in the construction industry. Built upon the financial theories and methodology, the overall success level of construction M&A transactions was assessed. The research findings, which were drawn from an analysis of 171 construction M&A transactions, indicate that the performance of construction M&A was positive at an insignificant level, as measured by equity market returns. Whereas the relationship between the type of diversification strategy and performance indicates that while the related diversification strategy has been slightly favored by both theories and empirical research findings over unrelated diversification, no significant performance difference was observed between two diversification strategies.Key words: mergers and acquisitions, diversification strategy, equity market returns.
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Varian, Hal R. "Symposium on Takeovers." Journal of Economic Perspectives 2, no. 1 (February 1, 1988): 3–5. http://dx.doi.org/10.1257/jep.2.1.3.
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Of the hundred largest mergers and acquisitions on record up to 1984, 65 occurred between 1981 and 1983, and only 11 occurred prior to 1979. During the 1981-84 period, there were at least 45 transactions of over a billion dollars apiece; prior to this period there were only a dozen or so transactions of such magnitude. What is the meaning of this “merger mania?” Why did it occur so suddenly? Is the wave of takeovers merely a speculative bubble, or is it motivated by fundamental economic conditions? What can we expect in the future? What policy responses, if any, are appropriate in light of this explosion of takeover activity? The papers in this symposium offer four perspectives on takeover activities.
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Özgür, Şevkat, and Franz Wirl. "Cross-Border Mergers and Acquisitions in the Oil and Gas Industry: An Overview." Energies 13, no. 21 (October 26, 2020): 5580. http://dx.doi.org/10.3390/en13215580.
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This paper surveys cross-border oil and gas mergers and acquisitions (M&A) transactions in recent years using a large sample of 18,179 transactions announced over the period 2000–2018. M&A activities depend on economic fundamentals, but also on sector specifics and this particularly holds true for the oil and gas industry. Therefore, we have added sector specific to the standard economic explanations of mergers and acquisitions by accounting for institutions, resources, and politics. Indeed, our outputs show that industry-specific factors seem much more important in motivating M&A in the oil and gas industry than the familiar and researched economic conditions. In particular, the pattern of cross-border M&A is almost unrelated to opportunities offered by the resource base in different countries while political, institutional, and legal constraints shape the directions of cross-border M&A. The research covers the recent trends in the oil and gas M&A transactions, strengthens the understanding of various dynamics and sheds light on the potential future directions of the M&A market in the oil and gas industry.
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Kapoor, Sakshi. "Mergers And Acquisitions: Current Scenario And Emerging Trends In India." Volume 1 Issue 6 1, no. 6 (August 31, 2018): 69–88. http://dx.doi.org/10.31426/ijamsr.2018.1.6.618.
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The Mergers and Acquisitions (M&A) have gained pervasive importance for restructuring the business organizations in India. While there was a slowdown in the M&A activities in India initially, but over the past years the trends have changed and there has been rapid growth with diverse effects seen across the various sectors and the Indian business organizations have also been getting involved in many high-profile transactions. Till the recent past, the incidence of Indian entrepreneurs, acquiring foreign enterprises was not so common. The situation has undergone a sea change in the last couple of years
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Rogozhin, Aleksandr A. "Mergers and Acquisitions in Southeast Asia under COVID-19." South East Asia: Actual problems of Development 1, no. 1(50) (2021): 47–54. http://dx.doi.org/10.31696/2072-8271-2021-1-1-50-047-054.
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The article examines the state of mergers and acquisitions (M&A) operations in Southeast Asia during the COVID-19 pandemic. Based on the analysis of factual and statistical data, the author made the following conclusions: 1) in 2020, the volume of M&A operations in the region has sharply decreased both in quantitative and value terms; 2) Singapore, Malaysia, Indonesia remained the most active participants in M&A transactions; 3) the sectoral preferences of investors have changed significantly: the positive dynamics of M&A operations was observed only in two sectors – in agriculture and the production of consumer goods, mainly food; the traditionally dominant real estate and financial services business has been hit hardest. The author believes that the revival of M&A operations may begin in the next two or three years, mainly in Singapore, Malaysia and Vietnam.
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Dezi, Luca, Enrico Battisti, Alberto Ferraris, and Armando Papa. "The link between mergers and acquisitions and innovation." Management Research Review 41, no. 6 (June 18, 2018): 716–52. http://dx.doi.org/10.1108/mrr-07-2017-0213.
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Purpose The link between mergers and acquisitions (M&A) and innovation has been analysed in both corporate finance studies and the innovation literature. Despite this attention and the practical evidence that highlights different connections between these two terms, there is a need to investigate the latest trends with regard to these important topics, and to put a particular focus on the emerging paradigm of open innovation. Thus, this paper aims to provide a systematic literature review (SLR) about the relationship between M&As and the concept of innovation in the current scenario. Design/methodology/approach Through an SLR from 2012 to June 2017, 55 papers have been identified and analysed to give a better understanding of the motivations and the methodologies adopted in past studies. Findings This paper identifies various conceptual and research methodological characteristics of studies that have connected, directly or indirectly, M&As and innovation in recent years. In addition, the results highlight a scarcity of studies that explicitly or implicitly refer to the open innovation paradigm, marking only a partial understanding of this emerging phenomenon. Originality/value This paper improves the knowledge on the link between extraordinary corporate transactions and innovation, and it highlights that a clear consensus, particularly regarding the open innovation paradigm, is lacking. Thus the authors propose that future studies should carefully evaluate M&As by following the open innovation approach.
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Sherif, Mohamed. "Gains and payments of mergers and acquisitions: Further evidence from the UK." Corporate Ownership and Control 9, no. 3 (2012): 288–302. http://dx.doi.org/10.22495/cocv9i3c2art6.
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Using the UK data and the standard Event Study methodology framework, the wealth effects of target and acquiring companies involved in merger and acquisition activities over the period from 2000 to 2010 is investigated. Further, we extend our analysis to examine the financing payments of M&A transactions using various test models, namely the size-deciles (SD) control model, Hoare-Govett small companies model, index model (IM), market model (MM) and the capital asset pricing model (CAPM). The results in general indicate that target companies obtain significantly positive and higher abnormal returns than those obtained by the UK acquirers. The results are positively associated with cash offers used in financing the merger and acquisition transactions. Consistent with previous studies we found no clear pattern of abnormal returns around the announcement period for the UK acquirers. Interestingly, the five different test models are generally found to produce similar levels of abnormal returns
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Jung, Jin-Young, Wei Wang, and Sung-Woo Cho. "The Role of Confucius Institutes and One Belt, One Road Initiatives on the Values of Cross-Border M&A: Empirical Evidence from China." Sustainability 12, no. 24 (December 9, 2020): 10277. http://dx.doi.org/10.3390/su122410277.
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This study examines how national cultural policies such as Confucius Institutes and One Belt, One Road initiatives (BRI) affect the post-acquisition returns of Chinese cross-border mergers and acquisitions based on data from a sample of 192 transactions covering 2011 to 2015. We find that the cultural export of Chinese Confucius Institutes and the BRI exert a significantly positive impact on long-term acquirer returns, while cultural/institutional distance exerts a negative impact. Further evidence shows that Confucius Institutes and BRI mitigate the negative effect of cultural distance between merging firms. These results offer the first evidence that national cultural translation has substantial impacts on the long-run acquirer financial performance of cross-border mergers that decrease cultural institutional heterogeneity between countries.
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Varmaz, Armin, and Jonas Laibner. "Announced versus canceled bank mergers and acquisitions." Journal of Risk Finance 17, no. 5 (November 21, 2016): 510–44. http://dx.doi.org/10.1108/jrf-05-2016-0069.
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Purpose This paper aims to empirically analyze the success of European bank mergers and acquisitions (M&As) by an analysis of the shareholder value implications of stock market reactions to announced and canceled M&As in the period from 1999 to 2015. Design/methodology/approach The analysis of a sample of 467 announced and 54 canceled European bank M&As is conducted using event study methodology. The determinants of the shareholder value creations in M&A are observed in cross-sectional regressions. The likelihood of M&As being canceled is estimated in logit regressions. Findings The paper finds that European bank M&As have not been successful in terms of shareholder value creation for acquiring banks, whereas targets experienced significant value gains. Abnormal returns for bidders and targets exhibit the same characteristics upon the announcement of M&As that are canceled at a later date, whereas the results for transaction cancelations deviate. Targets experience negative abnormal returns at a larger size than upon the transaction announcement. The findings for bidders are striking, as they destroy shareholder value upon the transaction cancelation, also, consequently they suffer twice. In particular, banks with higher profitability, higher efficiency and lower liquidity experience negative abnormal returns around the announcement dates. Negative abnormal returns prior to the transaction announcement and provision for loan losses increase significantly the likelihood of M&A cancelation. Originality/value This paper contributes to the literature expanding existing analyses to the shareholder value implications of canceled European bank M&As in a 17-year long time period. The findings reveal the destructive characteristics of canceled bank M&As and provide innovative insights into European capital market reaction to canceled M&As.
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Li, Shi, and Shizhong Huang. "Politics, culture and M&As’ transaction completion." Nankai Business Review International 9, no. 3 (August 6, 2018): 264–88. http://dx.doi.org/10.1108/nbri-05-2017-0023.
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Purpose Mergers and acquisitions (M&As) dominated by Chinese enterprises have become increasingly conspicuous and prevalent in recent years. However, many of them were obstructed by foreign governments on the ground of “Threating National Security”. Overseas acquisition is a crucial step of Chinese Government’s “Going-Out” strategy, so analyzing the attribution of its success and failure is very important. Design/methodology/approach This paper adopts empirical study method to analyze the factors from political and cultural perspectives based on a sample of 327 cross-border M&A transactions made by all listed companies in China from 1997 to 2010. Findings The result shows higher failure rate for those acquisition targets which could be classified as political sensitive assets; meanwhile, positive diplomatic relations and higher bilateral trust between China and the host country will facilitate the M&A transaction. Originality/value This paper offers a new research angle on cross-border M&As, which is the impact of culture factors, as well as diplomatic relationship, bilateral trust and war history between China and the host country on M&A transactions. This paper also constructs several ways of measuring the diplomatic relationship between countries.
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Pazarski, Michail, Panagiotis Pantelidis, Alexandros Alexandrakis, and Panagiotis Serifis. "Successful merger decisions in Greece: Facts or delusions?" Corporate Ownership and Control 11, no. 2 (2014): 708–17. http://dx.doi.org/10.22495/cocv11i2c7p4.
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This study examines the success of merger decision in Greece during the last years through an extensive accounting study. The events of mergers and acquisitions (M&As) that have been performed from all merger-involved firms listed on the Athens Stock Exchange in the period from 2005 to 2007 are evaluated using accounting data (financial ratios), and from them the final sample of the study that is finally investigated consists from thirty five Greek firms, which executed one merger or acquisition in the period from 2005 to 2007 as acquirers and have not performed any other important acquiring decision in a three-year-period before or after the examined M&As transactions. For the purpose of the study, a set of sixteen ratios is employed, in order to measure firms’ post-merger performance and to compare pre- and post-merger performance for three years (or two years or one year) before and after the M&As announcements (with data analysis from 2002 to 2010). Furthermore the impact of the means of payment, of international or domestic M&As and of conglomerate or non-conglomerate mergers are evaluated. The results revealed that mergers have not any impact on the post-merger performance of the acquiring firms. Thus, the final conclusion that conducted is that the M&As activities of the Greek listed firms of this research have not lead them to enhanced post-merger accounting performance. Last, from the research results, it is clear that there is no difference from the mean of payment (cash or stock exchange) on the post-merger performance at the acquiring firms, and there is a better performance for international and conglomerate M&As.