eThesis - School of Business electronic theses

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Objective of the study The purpose of this thesis is to study acquirers performance persistence issue in merger and acquisition (M&A) market based on empirical evidence from EU 15 countries. This study provides an overview of different factors affecting serial acquirers' performance in M&A market as measured by excess stock returns. Focus of this thesis is to test the existence of acquirers performance persistence and factors contributing to this possible persistence effect.

Academic background and methodology An overview of existing theories and analysis framework regarding M&A market and acquirers' performance behaviors is obtained through literature research. Empirical data regarding M&A market in EU 15 countries are obtained from various data sources available from Aalto University School of Business. Data are processed by using statistical package EViews. The purpose of the statistical analysis is to discover relations between various variables and acquirers' performance persistence in M&A deals. The regression results are analyzed using established theories on M&A performance, as well as by comparing with relevant study from other scholars.

Findings and conclusions This thesis uses a statistical analysis model in which different variables pertinent to M&A deals, together with acquirers' prior performance, are analyzed for detecting their impacts on acquirers' performance. This study reveals that depending on different model specifications, acquirers' performance persistence can be identified in terms of value creation for own companies, value creation for both acquirers and targets, and acquirers' bargaining power in acquisition deals.