MOVING BEYOND THE LOCAL MARKETPLACE: DYNAMICS OF MERGERS AND ACQUISITIONS

Mergers and acquisitions (M&A), as well as the corporate restructuring intercede a great part of the corporate financial world. The most distinguished, the fifth merger wave, found to be five times larger in real terms compared to its predecessor, has involved companies within the service sector, principally those coming from the OECD countries. Historical trends, however, suggest that nearly two-thirds of big M&A have lost the value on the stock market and merely 46% have not been disappointed on their own terms. Hence, this paper aims at assessing the effects, regional and sectorial patterns of M&A, as well as to address some related implications by means of detailed and comprehensive data set.mergers and acquisitions, sectorial break-down, regional divergence, efficiency gains, failure

Mapping the future of cross-border mergers and acquisitions: a review and research agenda

Cross-border mergers and acquisitions (MandA) are considered one of the main strategies employed by firms to maintain a competitive edge and compete in the high-velocity global industry. This research field holds great promise as many facets are underexplored. Taking into consideration the growing interdisciplinary interest in MandA research, in this article, we performed content analysis in combination with the statistical procedure homogeneity analysis by means of alternating least squares (HOMALS) on 933 articles gathered from the Web of Science and Scopus databases. The quantitative analysis of the intellectual structure of cross-border MandA field yielded the six topics of interest for future research: acquisition versus strategic alliance or joint venture, partial purchase, the outbound acquisitions from emerging-market firms, micro-multinationals, the human side of cross-border acquisitions that tie in with the upper echelons research and knowledge management and transfer, in specific, tacit knowledge

Essays on mergers and acquisitions

“Essays on Mergers and Acquisitions" tackles some of the most prominent business challenges related to M&A activity. The Introduction examines the reasons why deals fail through well-known case studies; Chapter 1 presents a new index measuring countries M&A maturity worldwide; Chapter 2 focus on the importance of corporate governance when conducting deals in unknown territories; whilst Chapter 3 and 4 conduct research on companies’ decision to tap capital markets and their subsequent M&A activity

Pirmspārņemšanas audita noteicošie faktori pārrobežu uzņēmumu pārņemšanas gadījumos: promocijas darbs

Pārrobežu pārņemšanai ir svarīga loma uzņēmumu stratēģiskajā attīstībā un starptautiskās darbības paplašināšanā. Promocijas darbā pētīti pirmspārņemšanas fāzē veicamā pirmspārņemšanas audita noteicošie faktori, to klāsts, izvirzītā hipotēze - pirmspārņemšanas fāzes kompleksais pirmspārņemšanas audits ir saistīts ar pārņemšanas panākumiem. Rezultāti atbalsta pieņēmumu, ka veiksmīgas pārņemšanas pirmspārņemšanas audita noteicošie faktori ir stratēģiskā partnera izvēle, uzņēmējdarbības potenciāls, cilvēkresursu zināšanas, finanšu faktori un pārņemšanas maksa, galvenā atziņa ir, ka uzņēmējdarbības potenciāls un cilvēkresursu zināšanas ir galvenie aktīvi, lai pārņemšanas fāzē varētu realizēt sinerģijas vērtības. Atslēgas vārdi: pirmspārņemšanas audits, informācijas asimetrija, organizāciju mācīšanās, apvienošana, pārņemšana, riska novērtējumusCross - border acquisitions play an important role in the corporate strategic development and international expansion. During the past decades, mergers and acquisitions were intensively researched through the lens of strategic management, corporate finance, behavioral finance etc. Despite the intense effort, the made progress is still fragmented and lacks unifying theories that approaches the whole acquisition process on the one side, and indepth research of critical factors on the other side. The dissertation topic intends to establish vital link between research and practice, deeply exploring infor mation asymmetry and role of exploratory learning in the pre - acquisition phase of cross - border acquisition. This thesis investigates the critical factors – and the scope of the due diligence, which is carried out in the pre - acquisition phase. Pre - acquisition due diligence theoretically conforms to the organizational learning theory, proposing that the more the acquiring firm learns about the acquisition target, the higher the probability of successful acquisition. The central hypothesis of the comprehensive model states that due diligence in the pre - acquisition phase is necessary for acquisition success. The empirical evidence is data sample of acquisitions made in the automotive manufacturing firms and their cross - border acquisitions in the European automot ive industry . The main results support the proposition that Choice of Strategic Partner, Business Capabilities and HR Knowledge and Financial Factors and Acquisition Premium are critical factors of due diligence needed for acquisition success. The main eff ort lies in pinpointing the specific area by which the business capabilities and knowledge transfer build the main asset in the realization of synergy values in the acquisition phase. In this context, the valuation of the business capabilities of the acqui sition targets is classified as the main challenge reflecting suitability of the acquisition price and establishing value generation from the combined firms in the post - acquisition phase. By studying acquisition risk and critical factors – both success and failure reasons – this research has tested and partially approved a theoretically sound assessment framework that can pre - determine the success or failure of planned acquisition efforts. From a practical standpoint, the research results provide acquisition management with proven method of performing the pre - acquisition evaluation of potential acquisition candidates. Such a reference offers critical factors evidence for firms with acquisition needs. Key words: due diligence, information asymmetry, organizational learning , risk assessment , mergers, acquisitions, cross - border acquisition

Three essays in corporate governance and corporate finance : international evidence

This thesis presents three original research frameworks, two in corporate governance and one in corporate finance, distributed in three empirical chapters, respectively. Specifically, in Chapter 1, a novel multi-criteria decision analysis (MCDA) approach is developed not only to quantify an aggregate quality of corporate governance at firm level, but also to overcome the limitations of the existing measures (i.e., corporate governance indices) mainly with respect to full compensatory structures and industry-wide heterogeneity. Furthermore, the empirical approach, using PROMETHEE methods and econometric analysis of panel data, provides a strong inverse relationship between firm performance and corporate governance quality. The results rely on outranking relationships (over five million pair comparisons) among companies (1,203 US listed firms during 2002 to 2014) across various corporate governance criteria, comparing the aggregate quality against a well-known corporate governance index (ASSET4 ESG in Datastream).In Chapter 2, the theory of system reliability is used to model the behaviour of companies in terms of their corporate governance practices and mechanisms. Particularly, machine-learning techniques are proposed to assess a corporate governance system. The mapping of its inputs or specific indicators (e.g., corporate social responsibility, average number of board meetings, compensation policy, auditing independency and independent board) as components (either in operating or failed state), along with firm-specific conditions (i.e., age, size, risk, growth), into a reliability system aims to determine an approximate structure function that models the behaviour of the system. The proposed approach is applied to another data sample set of 1,109 US listed companies during 2002 to 2014, the financial and non-financial indicators are modelled as components of the corporate governance system, and returns on assets is defined as the system output. The results show that growth opportunities matter for the proper functioning of the system, and suggest that if companies are more transparent (i.e., components show a low probability of failure) both the trustworthiness of the companies and the system reliability improves.In Chapter 3, a research framework to analyse failure in mergers and acquisitions (M&A) reveals that not only deal characteristics (i.e., deal attitude, means of payments, deal size, ownership), but also acquirers’ and targets’ firm size, acquirers’ economic freedom, and targets’ accounting returns significantly explain the likelihood of deal failure. To this aim, a large dataset of 137,116 worldwide M&A deals (during 1977–2014 on more than 140 countries) and novel specifications of logit regression models are analysed. This chapter contributes and expands the literature in M&A deals and business research by evaluating how incumbents’ specific information can constrain the firms’ assets movement (efficiency perspective).Regarding the implications, the findings in Chapter 1 are of particular interest to both scholars and decision makers (e.g., managers, shareholders, investor, policy makers) including rating agencies, who want to assess advantages and disadvantages of corporate governance indices. Chapter 2’s findings are useful mainly for board of directors for detecting what corporate governance components are more line up with the most successful companies, or for quantifying firm reliability. The results in Chapter 3 suggest to bidders to be aware of not only deal characteristics, but also firm size discernments, economic freedom outlooks, and accounting figures when considering the exit option of a deal withdrawal

Small Business Merger and Acquisition Strategies for Raising Capital in Emerging Economies

About 70% of mergers and acquisitions (M&As) involving small and medium-sized enterprises (SMEs) in emerging economies fail because the strategies employed do not integrate all the critical success elements, leaving SMEs without the needed capital to take advantage of strategic and market opportunities. The purpose of this multiple case study was to explore the M&A strategies SME owners in Ghana employed to raise capital. Seth\u27s value creation theory was the conceptual framework adopted for this study. The population consisted of 5 SME owners in Ghana who had successfully raised financial resources through inbound M&As within the past 10 years. Data were collected through semistructured interviews and review of corporate annual reports and M&A documents. The data were organized and analyzed using Yin\u27s 5-step data analysis and cross-case synthesis techniques to identify patterns and emergent themes. The 6 themes that emerged from the analysis were value creation, control and autonomy, entrepreneurial quality, leadership, trustworthiness, and effective negotiation. SME owners can integrate entrepreneurial quality and effective negotiations to achieve successful closure of M&A deals. The findings of this study might facilitate SME access to capital for expansion and growth that will contribute to positive social change through job creation and increased youth employment in emerging economies