Antecedents of growth through mergers and acquisitions: Empirical results from Belgium

Huyghebaert, Nancy; Luypaert, Mathieu

doi:10.1016/j.jbusres.2009.06.003

Cited by 62 publications

(46 citation statements)

References 40 publications

(44 reference statements)

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“…With the fifth takeover wave, which started in the mid‐1990s, mergers and acquisitions (M&As) have become an increasingly popular business development strategy in Europe, with European deals now accounting for about half of the worldwide M&A volume (e.g., Huyghebaert and Luypaert, 2009). In this respect, the fifth wave marks a clear contrast with earlier M&A waves in which almost exclusively US and UK firms participated.…”

Section: Introductionmentioning

confidence: 99%

Can Stock Markets Predict M&A Failure? A Study of European Transactions in the Fifth Takeover Wave

Craninckx

Huyghebaert

2010

European Financial Management

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In this paper we develop various measures of M&A failure for an intra-European sample during the fifth takeover wave: inferior long-term stock performance, inferior operating performance, and target divestment. After documenting the extent of M&A failure, we test the relation between short-term abnormal returns at deal announcement and M&A failure. We examine a sample where listed bidders acquire listed targets (267 deals) as well as privately-held targets (336 deals). Our results indicate M&A failure rates up to 50% in both samples. When acquirers and targets are listed, lower M&A announcement returns are consistently and significantly associated with higher M&A failure probabilities and long-term losses. In contrast, when targets are privately held, we find no evidence of such an association.The authors wish to express their gratitude to the editor John Doukas and an anonymous referee at European Financial Management. They are further grateful for the useful comments

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Section: Introductionmentioning

confidence: 99%

Can Stock Markets Predict M&A Failure? A Study of European Transactions in the Fifth Takeover Wave

Craninckx

Huyghebaert

2010

European Financial Management

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“…In 1997 and 1998 only European deals are recorded, while international deals are included starting from 1999. According to Huyghebaert and Luypaert [2010], Zephyr "covers deals of smaller value and has a better coverage of European transactions". A comparison and more detailed discussion of the two databases can be found in Bollaert and Delanghe [2015] and Bena et al [2008].…”

Section: F1 Mergers and Acquisitionsmentioning

confidence: 99%

Network Formation with Local Complements and Global Substitutes: The Case of R&D Networks

2017

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractIn this paper we introduce a stochastic network formation model where agents choose both actions and links. Neighbors in the network benefit from each other's action levels through local complementarities and there exists a global interaction effect reflecting a strategic substitutability in actions. The tractability of the model allows us to provide a complete equilibrium characterization in the form of a Gibbs measure, and we show that the structural features of equilibrium networks are consistent with empirically observed networks. We then use our equilibrium characterization to show that the model can be conveniently estimated even for large networks. The policy relevance is demonstrated with examples of firm exit, mergers and acquisitions and subsidies in the context of R&D collaboration networks.

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“…In contrast, the M&As as of the fifth wave were largely driven by strategic considerations. For those deals, global competition, technological innovation, and the liberalization and integration of markets, particularly in Europe, were an important impetus (e.g., Martynova and Renneboog, 2008;Huyghebaert and Luypaert, 2010). Probably, those forces were especially relevant for the firms that did not let themselves urge into acquisitions because of transient windows of opportunity engendered by soaring stock prices.…”

Section: Synergy Realization After the Acquisitionmentioning

confidence: 99%

“…Moreover, while takeovers used to be popular particularly in the USA, the M&A waves of the 1990s and mid-2000s have turned out to be worldwide phenomena, with many deals originating in Asia and especially also in Europe (see Martynova and Renneboog, 2008;Huyghebaert and Luypaert, 2010). However, research on takeovers, typically relying on data from earlier waves, has pointed out that many acquisitions are often unable to meet the great expectations expressed at their notification.…”

Section: Introductionmentioning

confidence: 99%

“…Considering the larger stake of Europe in the most recent takeover waves, such a focus seems warranted. Moreover, because of the differences in ownership structure and corporate governance, the monitoring of managers by major shareholders is much stronger in Continental Europe, thereby potentially reducing the role of managerial self-serving behavior as an antecedent of acquisitions (see also Huyghebaert and Luypaert, 2010). Besides, and somewhat related to this issue of control, cash deals are far more prevalent in Europe, which also mitigates the role of stock market misvaluation as a driver of external growth decisions.…”

Section: Introductionmentioning

confidence: 99%

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Sources of Synergy Realization in Mergers and Acquisitions: Empirical Evidence from Non-Serial Acquirers in Europe

Huyghebaert¹,

Luypaert²

2013

International Journal of Financial Research

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We empirically investigate the sources, magnitude, and timing of synergy realization for 293 M&As by non-serial listed acquirers in Europe during [1997][1998][1999][2000][2001][2002][2003][2004][2005]. In contrast to much of the existing literature, we find that the shareholders of non-serial acquirers gain significantly upon deal announcement. Next, we unravel the various sources of M&A value creation, in particular operating synergies resulting either from revenue enhancement or from savings on operating costs and investments, and financial synergies. Compared to its non-combining industry peers, the median combined sample firm reports a 4.92% larger sales growth rate by the third post-deal year. Operating costs relative to sales are reduced by an extra 1.53% over this same window. In leverage-increasing acquisitions, the median combined firm realizes a persistent 6.09% rise in its long-term debt ratio. Finally, our multivariate regression results point out that non-serial acquirers with a larger market-to-book ratio achieve more extensive operating synergies.

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Antecedents of growth through mergers and acquisitions: Empirical results from Belgium

Cited by 62 publications

References 40 publications

Can Stock Markets Predict M&A Failure? A Study of European Transactions in the Fifth Takeover Wave

Can Stock Markets Predict M&A Failure? A Study of European Transactions in the Fifth Takeover Wave

Network Formation with Local Complements and Global Substitutes: The Case of R&D Networks

Sources of Synergy Realization in Mergers and Acquisitions: Empirical Evidence from Non-Serial Acquirers in Europe

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