Reprint of “The impact of mergers and acquisitions on shareholders' wealth in the logistics service industry”

Abstract

Logistic service providers are facing significant challenges in recent years due to intensified competition and ever-increasing customer expectations for cohesive high-standard services at low cost. To cope with these developments many companies aim for external growth to realize operational efficiencies and exploit productive opportunities of new markets and diversified services. Accordingly, 2015 has even become the most active year for mergers and acquisitions in logistic service industry. However, studies examining the post-merger performance effect and its determinants are scarce. Consequently, this paper takes up this issue by analysing a sample of 826 transaction announcements taken place between 1996 and 2015 and their performance effect in terms of short-and long-term abnormal shareholder returns. The results reveal, that although overall transactions exhibit significant positive abnormal returns, post-merger performance for the acquiring companies differs considerably according to the logistic services offered. In the short-term trucking, railway, 3PL and air cargo companies experience significant positive abnormal returns of about 0.6%-2.6%, while sea freight carriers realize only marginal effects and CEP companies do even not show any significant reaction. In the long-term, railway and 3PL companies realize a significant abnormal return of about 20%-24%, while trucking, sea freight and air cargo carriers do not exhibit significant returns and CEP companies do even experience significant losses of about -17%. Overall, diversifying transactions of established full-service providers outperform focus-increasing transactions of specialised operators.

Has the Product Patent Regime Impacted Mergers and Acquisitions? Unveiling with a Systematic Literature Review

“…Chaudary and Mirza (2017), Goddard et al (2012) and Kolaric and Schiereck (2013) contributed their research in the banking industry. Similarly, Teti and Tului (2020)—infrastructure industry; Kiesel et al (2017)—logistics service industry; Campbell et al (2011)—real estate industry; Lehmann and Schwerdtfeger (2016)—IPO companies; Ameer and Azizan (2014)—family-owned business; Yang et al (2019)—trading industry, were conducted. These are some studies that cover various companies in diverse industries undergoing M&A parallelly.…”

“…The third is shareholder's value. The economic connotation of 'value' is the desirability of objects and it has taken various meanings over the years (Graeber, 2001) and the present review expresses it as shareholder's value' (Kiesel et al, 2017). Studies have examined the impact of M&A on the shareholders' value creation using measures such as earning per share, operating performance and cumulative abnormal returns (CAR) (Chen, 2019).…”

Logistics Services Sector and Economic Recession in Greece: Challenges and Opportunities

“…In particular, Mazzarino [37] identifies financial crisis as a major macro-level driver that impacts global logistics operations, further concluding that economic downhill: (i) determines a decrease in logistics flows as transport dynamics are linked to national and regional economic performance, (ii) fosters oligopoly in the logistics services market by promoting strategic alliances and mergers, and (iii) promotes modal shifts towards less costly and more efficient transport options. Motivated by the dominant economic crisis related challenges, encountered by individual logistic service providers, Kiesel et al [35] analyze 826 M&A transactions during the period 1996-2015 to investigate the resulting impact of such strategic consolidations on shareholder returns. The study findings reveal that the emergence of the financial crisis does have a positive impact on the performance of the combined company in the post-merger long-term integration period.…”

The effect of government involvement and payment method on merger and acquisition performance: the case of China

“…We choose the maximum of eleven-day period(-5, +5), that is, five trading days pre-and post-merger announcement becauseKiesel et al (2017) note that using extended event windows would obviously increase the probability of potentially overlapping and concurrent event to distort the results.…”