Cross-border Mergers and Acquisitions in different legal environments

Feito-Ruiz, Isabel; Requejo, Susana Menéndez

doi:10.1016/j.irle.2011.05.002

Cited by 65 publications

(25 citation statements)

References 68 publications

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“…Yet more recent evidence finds acquirers fare better in cross border deals, Goergen & Renneboog (2004), Feito-Ruiz & Menendez-Requejo (2011), Danbolt & Maciver (2012 and Dutta, Saadi & Zhui (2013).…”

Section: Related Literaturementioning

confidence: 99%

Do cross border and domestic acquisitions differ? Evidence from the acquisition of UK targets

Gregory

O’Donohoe

2014

International Review of Financial Analysis

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We investigate the determinants of short term wealth effects for both public acquiring and target shareholders following the announcement of UK acquisitions over the period 1990-2005. Regardless of their nationality, overall acquirers incur losses, with domestic acquirers underperforming cross-border acquirers in general. For the latter no differences in returns between regions are found once the differences in corporate governance regimes are controlled for.Instead it is firm characteristics and in particular firm leverage that largely explains acquirers returns. All targets gain significantly but the higher returns associated with international deals disappear once bid characteristics are controlled for.

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Section: Related Literaturementioning

confidence: 99%

Do cross border and domestic acquisitions differ? Evidence from the acquisition of UK targets

Gregory

O’Donohoe

2014

International Review of Financial Analysis

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“…However, foreign private firms are not subject to such a competition, allowing foreign bidders to acquire them at a discount. On the other hand, the acquisition of public targets located in developed economies is subjected to strict takeover regulations that could increase the cost of the deal (Feito‐Ruiz and Menéndez‐Requejo, ), making private targets more attractive to foreign investors. In addition, the costs incurred by the acquirers in searching information on foreign private targets are relatively high because of the limited information disclosed by such firms, nonavailability of a public price and the lack of analyst reports on them (Mantecon, ).…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Target's organisational form and returns to Australian bidders in cross-border acquisitions

2013

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We present large sample evidence on return performances of Australian acquirers who bid for public and private targets in cross-border acquisitions. While placing a particular emphasis on the method of payment and the shareholder protection offered by the target country, we analyse the impact of various bid, firm and foreign-acquisition-specific characteristics on bidding firms' abnormal returns. We find that Australian investors perceive crossborder acquisitions as value-creating exercises regardless of the organisational form of the target acquired. However, bidders for private targets earn higher return when the method of payment is stock and the targets are located in high investor protection countries. We further find that the abnormal returns are conditional to the relative size of the target, bid frequency, target country destination and the preacquisition financial performance of bidding firms.

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“…A stronger legal and institutional environment in the target country leads to increased transaction cost for cross-border deals. This issue coincides with regulatory changes in countries with a strong legal and institutional environment, which may make access to markets for firms from countries with weak legal and institutional environments more difficult (Feito-Ruiz et al, 2011).…”

Section: Source: Own Illustration Based On Different Sourcesmentioning

confidence: 95%

Tendencies of Electricity Production and Consumption in the Baltic Sea Region

Allena¹

2014

Conference Proceedings

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Cross-border Mergers and Acquisitions in different legal environments

Cited by 65 publications

References 68 publications

Do cross border and domestic acquisitions differ? Evidence from the acquisition of UK targets

Do cross border and domestic acquisitions differ? Evidence from the acquisition of UK targets

Target's organisational form and returns to Australian bidders in cross-border acquisitions

Tendencies of Electricity Production and Consumption in the Baltic Sea Region

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