Multi-factor SUR in event study analysis: evidence from M&amp;A in Singapore's financial industry

Tanuwidjaja, Enrico

doi:10.1080/17446540600706882

Cited by 4 publications

(3 citation statements)

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“…There are few important studies that do not support improvement in post‐merger performance; for example, Kaur (2002) concludes that both profitability and efficiency of target companies decline. Likewise, no momentous progress reported in the post‐merger period (Beena, 2004; Kumar, 2009; Kumar and Suhas, 2010; in Singapore: Tanuwidjaja, 2007). In Malaysia, Rahman and Limmack (2004) examine 94 publicly listed acquiring and 113 private target companies during 1988‐1992 and argue that the progress in operating performance does not come at the cost of long‐term investments.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

“…There are modest contributions in the M&A field that focus on post‐merger evaluation in developing nations: India (Beena, 2004; Das, 2000; Kaur, 2002; Kumar, 2009; Ramakrishnan, 2008; Rao and Rao, 1987; Selvam et al , 2009; Sinha et al , 2010), Singapore (Tanuwidjaja, 2007), Malaysia (Marimuthu, 2008; Rahman and Limmack, 2004), Greece (Mylonidis and Kelnikola, 2005) and Pakistan (Ullah et al , 2010).…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

“…Beena, 2004;Das, 2000;Kaur, 2002;Kumar, 2009;Ramakrishnan, 2008;Rao & Rao, 1987;Selvam et al, 2009;Sinha et al, 2010), Singapore (Tanuwidjaja, 2007), Malaysia (Marimuthu, 2008;Rahman & Limmack, 2004), Greece (Mylonidis & Kelnikola, 2005) and Pakistan (Ullah et al, 2010). Rao and Rao (1987) (Selvam et al, 2009).…”

Section: Studies In Developing Economiesmentioning

confidence: 99%

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Corporate mergers and financial performance: a new assessment of Indian cases

Reddy

Nangia

Agrawal

2013

Nankai Business Review International

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PurposeIt is worth mentioning that mergers and acquisitions (M&As) have become a popular vehicle for emerging‐markets firms to rapidly access new opportunities and market capabilities. Indeed, privatization and multi‐nationalization have given a greater shore up in raising global and domestic merger deals. Motivated by these factors, the purpose of this paper is to investigate “do mergers produce abnormal returns around the announcement; conversely, do they improve financial performance in the long‐run?”Design/methodology/approachThe study applies earnings management approach (event study) to compute average abnormal returns (AAR) around the merger announcement for select Indian M&A cases. Further, accounting ratios are considered to assess the long‐run financial performance. Thereafter, t‐stat is applied for testing the proposed hypotheses. In particular, it has performed a later test to the means of financial ratios and variables for both services and manufacturing sectors in accounting ratios and cylinder models, respectively.FindingsThe select Indian M&A cases show superior performance during the post‐merger period for both manufacturing and services sectors, and observe a balance sheet improvement in the long‐run.Research limitations/implicationsSample is one of the limitations to the study. Due to small sample of merger cases, this paper has limited scope to generalize the results. Hence, academic researchers may employ the suggested assessment (cylinder)‐models on a large sample.Practical implicationsThe research work would help financial analysts, stockbrokers, M&A advisory and regulatory bodies while designing takeover and open offer policies.Originality/valueThis is an original contribution, which has developed new assessment (cylinder)‐models to examine the post‐merger long‐run financial performance of acquiring firms, especially sector‐wise evaluation.

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