Cross-Border Arbitrage and Acquisition Performance in the Eurozone Crisis

Nicholson, Rekha Rao; Salaber, Julie

doi:10.5465/ambpp.2014.13941abstract

Cited by 2 publications

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“…Event study methodology is very common in mergers and acquisitions literature (Diepold et al 2008;Hosken and Simpson 2001;Nicholson and Salaber 2013;Rao-Nicholson and Salaber 2014a) where the acquirer's cumulative abnormal returns (CAR) are calculated as:…”

Section: Event Studymentioning

confidence: 99%

Impact of the Financial Crisis on Banking Acquisitions: A Look at Shareholder Wealth

Rao‐Nicholson

Salaber

2015

International Journal of the Economics of Business

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This paper examines the influence of the 2007-08 financial crisis on value creation for acquirer's shareholders in the banking industry using a sample of 883 deals over 2004-12. Applying an exploratory and top-down approach, banking acquisitions are considered at the global level, narrowing the analysis step by step to consider domestic versus cross-border acquisitions. Then cross-border deals are split based on the economic development of the acquirer and target countries. It is observed that only acquisitions involving emerging-economy acquirers and developed-economy targets generate positive and significant returns to shareholders after the crisis. Major changes in the global acquisition landscape are also observed since 2007, with emerging-economy banks increasing their acquisition activity, both nationally and internationally.

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Section: Event Studymentioning

confidence: 99%

Impact of the Financial Crisis on Banking Acquisitions: A Look at Shareholder Wealth

Rao‐Nicholson

Salaber

2015

International Journal of the Economics of Business

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“…Also, recent studies have shown that the turbulences in the business environment can have a significant impact on bidder's returns (Beltratti & Paladino, 2013;Rao-Nicholson & Salaber, 2014a, 2014b, 2015Wan & Yiu, 2009). Thus, it is interesting to look at the impact of the 2007-2008 financial crisis on the OP of M&As in ASEAN.…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

Long-term performance of mergers and acquisitions in ASEAN countries

Rao‐Nicholson

Salaber

Cao

2016

Research in International Business and Finance

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The study looks at mergers and acquisitions (M&As) in ASEAN countries and examines the post-M&A performance using data from 2001 to 2012. The industry-adjusted operating performance tends to decline in the 3 years following an M&A. Yet, the results suggest that M&As completed during the financial crisis are more profitable than those implemented before and/or after the crisis. We argue that this is mainly due to the synergies created between the firms' resources during the crisis which augur well for firms' economic performance. We find that, during the crisis, certain characteristics of the firms like the relative size of the target, cross-border nature of deals, acquirer's cash reserves and friendly nature of deals are important determinants of long-term post-M&A operating performance.However, for M&As during the crisis, there appears to be no relationship between performance and firms' characteristics linked to M&A activity such as payment method, industry relatedness and percentage of target's share acquired.

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Cross-Border Arbitrage and Acquisition Performance in the Eurozone Crisis

Cited by 2 publications

References 0 publications

Impact of the Financial Crisis on Banking Acquisitions: A Look at Shareholder Wealth

Impact of the Financial Crisis on Banking Acquisitions: A Look at Shareholder Wealth

Long-term performance of mergers and acquisitions in ASEAN countries

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