Chapter 2 Does Company Performance Improve After M&amp;A? A Literature Review

Berrioategortua, Joaquín Sanz; Olasagasti, Olga del Orden; Florencio, Beatriz Palacios

doi:10.1108/s1479-361x20180000017002

Cited by 14 publications

(10 citation statements)

References 39 publications

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“…Zollo and Meier (2008) distinguished that the integration outcomes are task‐level and short‐term dimension of M&A performance. M&A performance, as “the difference between pre‐merger and post‐merger performance” (Berrioategortua et al, 2018, p. 42), can be assessed in subjective or objective terms (Thanos & Papadakis, 2012; Zollo & Meier, 2008). Studies have long demonstrated that using only accounting criteria to evaluate firm performance was inadequate (Haleblian et al, 2009; Striteska, 2012).…”

Section: Literature Review and Research Frameworkmentioning

confidence: 99%

Chinese cross‐border mergers and acquisitions: How communication practices impact integration outcomes

Wang

Schweizer

2023

Thunderbird Intl Bus Rev

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This study provides an empirical investigation on how communication practices impact the post‐acquisition integration outcomes, in the context of Chinese cross‐border mergers and acquisitions (CBMAs). We tailored our assessment to reflect communication practices during Chinese CBMA integration. The integration outcomes are measured by organizational commitment and strategic performance improvement. Using a data collected via survey from global executives and middle managers, we find that communication accuracy, channel efficiency, and overseas business management department positively impact organizational commitment. Moreover, inter‐organizational trust mediates the effect of communication accuracy on organizational commitment, and communication officer on organizational commitment. In addition, we find that the language barrier of the Chairman negatively impacts strategic performance improvement. Moreover, acquisition experience, business relatedness, industrial investors, private‐owned investors, and management consultant all positively affect strategic performance improvement. However, middle managers negatively impact the integration outcomes.

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Section: Literature Review and Research Frameworkmentioning

confidence: 99%

Chinese cross‐border mergers and acquisitions: How communication practices impact integration outcomes

Wang

Schweizer

2023

Thunderbird Intl Bus Rev

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“…Mergers continue to be a crucial component of the contemporary economy and a key component of market regulation since the evolution and change of a company's organizational structure is a natural aspect of its life cycle (Berrioategortua, Olasagasti, & Florencio, 2018;Brown et al, 2016). The ability to react swiftly to potential changes in the economic, political, legal, and social aspects of the external environment is a prerequisite for the effective management of an enterprise (Kumar, 1984;Tampakoudis, Nerantzidis, Soubeniotis, & Soutsas, 2018).…”

Section: Introductionmentioning

confidence: 99%

Mergers in the agribusiness sector: Theoretical analysis and empirical evidence from Greece

Pazarskis

Gkatziou

Kourtesi

et al. 2023

IJAEFA

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Bigger and bigger companies are expanding their control over agriculture and food. Concentration processes with enormous dynamism are taking place at all stages of the supply chain. The trend is towards global players: companies are getting bigger through mergers and displacing the competition. Through their sales or purchasing policies, they are promoting a type of agriculture in which the focus is on increasing productivity and market share augmentation in the supply chain. The purpose of this research was to look into mergers that have occurred among companies in the agribusiness sector and provide useful insights from Greece. This study examined mergers in the agribusiness sector using a questionnaire distributed among employees of food companies and companies in food chains. The majority of the respondents had about five years of experience in the agribusiness sector and had a permanent position. The research results revealed that employees take a new wave of mergers in the agricultural sector for granted; however, they are concerned about how staff are dealt with and even layoffs. Finally, respondents claimed to be in favor of mergers to avoid the closure of yet more businesses but emphasized the importance of protecting workers’ rights.

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“…The studies examining the impact of mergers on performance of companies involved in it are divided into two types. One set of studies have focused on measuring impact of merger on financial performance of companies involved in India (Pawaskar, 2001;Beena, 2006;Mantravadi and Reddy, 2007;Rani et al, 2015) and around India (Ravenscraft and Scherer, 1989;Healy et al, 1992;Ramaswamy and Waegelein, 2003;Dutordoir et al, 2014;Berrioategortua et al, 2018).…”

Section: Introductionmentioning

confidence: 99%

Long-Term Abnormal Returns during Pre and Post Merger: Evidence from India

Variava¹,

Kapadia²

2022

NMMR

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Purpose: The present study measures the impact of merger on Indian acquiring entities’ long term stock price performance. The study covers 109 acquiring entities of merger deals undertaken during the period of 2000 to 2012, comprising of a study period of 1997 to 2015. Methodology: The same is measured through monthly CAR (Cumulative Abnormal Return) and BHAR (Buy and Hold Abnormal Return) of selected acquiring entities during the period of 12, 24 and 36 months post the merger and comparing it with 12, 24 and 36 months pre merger respectively. The Abnormal Return (AR) is computed as the excess of acquiring entity stock’s monthly log return over the market’s (SENSEX) monthly log return. A paired t-test has being applied to compare the pre and post CAR and BHAR after eliminating outliers using box-plot technique and assuring normality of variables. Findings: The results show a significant reduction in post merger monthly CARs and BHARs as compared to pre merger. Practical Implications: CAR being based on arithmetic mean is useful to investors who hold stocks for relatively short period of time around the merger month. BHAR being based on geometric mean is useful to investors who hold stocks for the entire holding period before and after the merger month. Originality: Abnormal returns pre and post merger scenario in the long run are less explored in the Indian context which this study aims at. The study also compares the results of abnormal returns around long term time frame in India with that of the global context as well.

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Chapter 2 Does Company Performance Improve After M&A? A Literature Review

Cited by 14 publications

References 39 publications

Chinese cross‐border mergers and acquisitions: How communication practices impact integration outcomes

Chinese cross‐border mergers and acquisitions: How communication practices impact integration outcomes

Mergers in the agribusiness sector: Theoretical analysis and empirical evidence from Greece

Long-Term Abnormal Returns during Pre and Post Merger: Evidence from India

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