The Impact of Acquisitions on Company Performance: Evidence From a Large Panel of Uk Firms

Dickerson, Andrew; Gibson, Heather D.; Tsakalotos, Euclid

doi:10.1093/oxfordjournals.oep.a028613

Cited by 213 publications

(158 citation statements)

References 21 publications

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“…This decrease in OP is significant for IAROA (equal to -2.25%), which is consistent with previous empirical studies (Clark & Ofek, 1994;Dickerson, Gibson, & Tsakalotos, 1997). However, the fact that other measures do not yield any significant difference between pre-and post-M&A performance supports the conjecture of Sharma and Ho (2002).…”

Section: Change In Operating Performancesupporting

confidence: 91%

Long-term performance of mergers and acquisitions in ASEAN countries

Rao‐Nicholson

Salaber

Cao

2016

Research in International Business and Finance

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The study looks at mergers and acquisitions (M&As) in ASEAN countries and examines the post-M&A performance using data from 2001 to 2012. The industry-adjusted operating performance tends to decline in the 3 years following an M&A. Yet, the results suggest that M&As completed during the financial crisis are more profitable than those implemented before and/or after the crisis. We argue that this is mainly due to the synergies created between the firms' resources during the crisis which augur well for firms' economic performance. We find that, during the crisis, certain characteristics of the firms like the relative size of the target, cross-border nature of deals, acquirer's cash reserves and friendly nature of deals are important determinants of long-term post-M&A operating performance.However, for M&As during the crisis, there appears to be no relationship between performance and firms' characteristics linked to M&A activity such as payment method, industry relatedness and percentage of target's share acquired.

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Section: Change In Operating Performancesupporting

confidence: 91%

Long-term performance of mergers and acquisitions in ASEAN countries

Rao‐Nicholson

Salaber

Cao

2016

Research in International Business and Finance

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“…This result is consistent with the results of some studies (Kumar, 1984;Healy et al, 1992;Chatterjee and Meeks, 1996;Ghosh, 2001;Srivastava and Prakash, 2014). However, it is not consistent with the results of some other studies that found a decline of the profitability ratios (Meeks, 1977;Salter and Weinhold, 1979;Mueller, 1980;Kusewitt, 1985;Ravenscraft and Scherer, 1987;Dickerson et al, 1997;Sharma and Ho, 2002;Oduro and Agyei, 2013;Pantelidis et al, 2014;Rodionov and Mikhalchuk, 2016 (in crisis periods). Also, the study results are not consistent with the results that found an improvement in accounting or profitability measures (Cosh et al, 1980;Parrino and Harris, 1999;Mylonidis and Kelnikola, 2005;Vijayakumar and Sridevi, 2013;Halimahton et al, 2014;Muhammad and Zahid, 2014;Erdogan and Erdogan, 2014).…”

Section: Evaluation Of Accounting Performance After Mergersupporting

confidence: 70%

“…Many past studies on post-merger performance that employed accounting ratios and were conducted during the last decades supported an improvement in the corporate performance after the M&As action (Cosh et al, 1980;Parrino and Harris, 1999;Vijayakumar and Sridevi, 2013;Muhammad and Zahid, 2014;Oruc Erdogan and Erdogan, 2014;Rao-Nicholson et al, 2016), while others claimed that there was a deterioration in the post-merger firm performance (Meeks, 1977;Salter and Weinhold, 1979;Mueller, 1980;Kusewitt, 1985;Ravenscraft and Scherer, 1987;Dickerson et al, 1997;Sharma and Ho, 2002;Oduro and Agyei, 2013), and some others concluded a "zero" result or ambiguous results from the M&As action (Kumar, 1984;Healy et al, 1992;Chatterjee and Meeks, 1996;Ghosh, 2001;Srivastava and Prakash, 2014;Rodionov and Mikhalchuk, 2016).…”

Section: Literature Reviewmentioning

confidence: 99%

Mergers, taxation and accounting performance: Some evidence from Greece

Pazarskis¹,

Drogalas²,

Koutoupis³

2017

J. Account. Taxation

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The study examines the merger effects on the accounting performance of Greek firms, in parallel with their taxation impact, during the period of economic crisis in Greece. The study analyses twelve accounting measures from financial statements and financial ratios of a sample of Greek listed firms in the Athens Exchange that carried out one merger in the period from 2010 to 2015 as acquirers. The results revealed that none of the twelve examined accounting measures have changed significantly due to the merger event, one year after the merger transaction. Different results are proposed regarding the impact of the type of industry, as the findings of the study indicate a better accounting performance for the constructions firms than the others from our sample. Furthermore, the study investigates the impact of the new Greek Income Tax Code (GITC) (Law 4172/2013) that refers to the corporate restructuring in Greece. There is evidence that there is some effect from the new GITC and it provides further opportunities for capital gains, not subject to tax from mergers, during the period of the economic crisis in Greece.

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“…The threat of losing their jobs and perquisites provides managers with an incentive to focus on shareholder objectives. The role of takeover regulation is then to design rules and provide instruments that minimize the costs and inefficiencies associated with the (hostile) takeover mechanism 8 and thereby facilitate a transfer of control towards more productive 8 However, hostile takeovers may constitute a disruptive and costly mechanism to bring about a change in control as the vast majority of the takeovers does not yield the anticipated synergistic value increase (Gregory, 1997;Dickerson, Gibson and Tsakalotos, 1997;Rau and Vermaelen, 1998;Ghosh, 2001;Louis, 2004). There is no evidence that hostile takeovers are able to create more (long-term) synergistic value than friendly ones and hostile acquisitions tend to be more disruptive than friendly ones.…”

mentioning

confidence: 99%

Corporate Governance Convergence: Evidence From Takeover Regulation Reforms in Europe

Goergen

2005

Oxford Review of Economic Policy

128

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Abstract:This paper contributes to the research on corporate governance by predicting the effects of European takeover regulation. In particular, we investigate whether the recent reforms of takeover regulation in Europe are leading to a harmonization of the national legislations. With the help of 150 corporate governance lawyers from 30 European countries, we collected the main changes in takeover regulation. We assess whether a process of convergence towards the Anglo-(American) corporate governance system has been started and we find that this is the case. We make predictions as to the consequences of the reforms for the ownership and control. However, we find that, while in some countries the adoption of a unified takeover code may result in dispersed ownership, in others it may further consolidate the blockholder-based system.

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The Impact of Acquisitions on Company Performance: Evidence From a Large Panel of Uk Firms

Cited by 213 publications

References 21 publications

Long-term performance of mergers and acquisitions in ASEAN countries

Long-term performance of mergers and acquisitions in ASEAN countries

Mergers, taxation and accounting performance: Some evidence from Greece

Corporate Governance Convergence: Evidence From Takeover Regulation Reforms in Europe

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