Business Analysis : M & A

3157 Words13 Pages
Chapter 1: Introduction
1.1 Overview
The modern world has seen the formation of firms as a mechanism of integration, which enables individuals to develop an enterprise and to combine capital and expertise from different individuals. Mergers, especially the mega-mergers, change the market structure. Mergers and Acquisitions (M&A) have unparalleled capability to transform firm and supplement corporate renewal. Research in M&A has been done taking into consideration a multitude of disciplines, e.g. finance, economics, law, business, strategy formulation, organization theory, human resource management and sociology. M&A becomes a real time phenomenon due to the attention it receives from different walk of life.
The victory of firms and the
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The unusual returns to the acquiring firm shareholders show contentious results. No noteworthy abnormal returns are suggested by some studies whereas some studies suggest a negative abnormal return that means reasons are unrecognised. Tuch and O’Sullivan (2007) and Agrawal and Jafee (2000) provide concerned evidence and reviewed the literature to find out the influence of some bid characters on M&A performance. Though, some questions regarding the influence of cross-border versus domestic transaction and timing of transaction on post M&A performance remain unanswered and therefore, more study is required to have the understanding of the impact of bid characters on M&A post performance. This study is different from previous research in many ways. Tuch and O’Sullivan (2007) present facts that shoot out from market measures-based and accounting measures-based studies. We widen the study of Tuch and O’Sullivan (2007) to fulfil the need of reassessing the previous research to estimate post M&A performance by examining mix measures-based and qualitative measures-based studies that may aid to elucidate changes in post-performance. Tuch and O’Sullivan (2007) uncover that the acquisition of hostile targets, transactions that are paid for with cash and acquisitions of larger targets are associated with superior (or at least negative) performance, while there is mixed evidence on the
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