Cross-Country Determinants of Mergers and Acquisitions

Rossi, Stefano; Volpin, Paolo F.

doi:10.2139/ssrn.395020

Cited by 203 publications

(251 citation statements)

References 8 publications

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“…The effects of cultural and institutional proximity have also been taken up in M&A studies, but this concerns primarily international M&A deals across countries (Chapman, 2003). International acquisitions are influenced by differences in the institutional and cultural national frameworks, financial and exchange rates conditions, and prospects of entry in new foreign markets (Rossi and Volpin, 2004;Ragozzino, 2009;Di Guardo et al, 2013). Our paper focuses on domestic M&A instead, in order to assess the role of proximities within a more homogeneous national context.…”

Section: Symmetric and Asymmetric Proximities In Mandamentioning

confidence: 99%

Symmetric and asymmetric effects of proximities. The case of M&A deals in Italy

2015

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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. Abstract (max. 100) This paper investigates the effect of geographical, industrial, organizational and institutional proximity on the probability that any two firms located in Italy engage in a M&A deal. Within a logistic rare event framework, we investigate 4,261 actual deals completed over the period 2000-2011 and around 3.8 million potential deals. We find robust evidence that all forms of proximity have a positive effect, especially industrial relatedness. Moreover, we find evidence that proximities generate asymmetric effects on M&A deals, depending on the location of bidders and targets and on whether some specific individual characteristics are featured by the acquirer or by the target firm. Terms of use: Documents in EconStor may

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Section: Symmetric and Asymmetric Proximities In Mandamentioning

confidence: 99%

Symmetric and asymmetric effects of proximities. The case of M&A deals in Italy

2015

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“…As a transaction-specific control variable, RELATIVE SIZE between bidder and target (Moeller et al 2004;Seth 1990) is defined as the index of bidder sales to target sales and deal value to market capitalization as a percentage. Other binary control dummy variables include (1) PUBLIC, for listed target companies (Chang 1998, Officer 2007; (2) CASH, for purchase price payments in cash (Faccio and Masulis 2005;Travlos 1987); (3) HOSTILE, for transactions with a hostile attitude (Franks and Mayer 1996;Loughran and Vijh 1997); (4) TOEHOLD, for previous minority shareholdings (Betton et al 2009;Franks and Harris 1989); (5) CROSSBORDER, for foreign targets (Goergen and Renneboog 2004;Rossi and Volpin 2004); and (f) CONGLOMERATE, for conglomerate acquisition direction (Healy et al 1992;Morck et al 1990). Regarding the latter control variable, CONGLOMERATE, it is important to highlight that this information is used in order to filter out the effect on each single transaction.…”

Section: Additional Control Variablesmentioning

confidence: 99%

Lost in transaction? The transfer effect of strategic consistency

Fehre

Kronenwett

Lindstädt

et al. 2015

Bus Res

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Prior empirical studies provide evidence that the learning-curve perspective from manufacturing settings is not directly applicable to strategic management settings. In the latter case learning relates to the quality rather than to the quantity of experience. Regarding the antecedents of organizational learning especially, there are still unanswered questions remaining; for example, the questions what kind of experience has a positive effect on performance and what kind of experience is more of a hindrance than a help. This becomes obvious when looking at acquisitions as examples of strategic management decisions. Results of prior empirical studies analyzing the relationship of acquisition experience and acquisition performance have been mixed. By introducing the concept of strategic consistency, we intend to facilitate a better understanding of the kind of experience necessary for organizational learning. Therefore, we measure the concordance and frequency of change in strategic actions. Employing a sample of 379 acquisition series, we find evidence for a positive transfer effect of strategic consistency within series and, therefore, a positive relationship between strategic consistency and acquisition performance.

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“…To capture the practical barriers, the S&P Emerging Markets database defines small and illiquid stocks as noninvestible. 7 It then creates a variable called the "degree open factor" or "investible weight," which ranges from 6 Some other studies also show that governance environments and monitoring ability play an important role in determining cross-border acquisitions and fixed investments (Rossi and Volpin (2004), Kelley and Woidtke (2006)), as well as international investment allocation (Dahlquist, Pinkowitz, Stulz, and Williamson (2003), Chan, Covrig, and Ng (2005), and Leuz, Lins, and Warnock (2009)). 7 These criteria vary at the discretion of S&P's Index Committee.…”

Section: A Descriptions Of the Sample Of Emerging Market Firmsmentioning

confidence: 99%

Large Foreign Ownership and Firm-Level Stock Return Volatility in Emerging Markets

Li¹,

Nguyễn²,

Pham

et al. 2010

SSRN Journal

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This study constructs a firm-level measure of large foreign ownership (LFO) and investigates its impact on stock return volatility in 31 emerging markets. We find a negative relationship between LFO and volatility, even after controlling for potential endogeneity and the impact of major domestic shareholders. This suggests a stabilizing role of LFO in emerging markets, which is consistent with previous suggestions in the literature on the strong commitments and potential monitoring role of large foreign shareholders. Overall, our study highlights the importance of recognizing the heterogeneity among foreign investors and the benefits of large foreign shareholders to emerging stock markets.

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Cross-Country Determinants of Mergers and Acquisitions

Cited by 203 publications

References 8 publications

Symmetric and asymmetric effects of proximities. The case of M&A deals in Italy

Symmetric and asymmetric effects of proximities. The case of M&A deals in Italy

Lost in transaction? The transfer effect of strategic consistency

Large Foreign Ownership and Firm-Level Stock Return Volatility in Emerging Markets

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