Do Synergies Exist in Related Acquisitions? A Meta-Analysis of Acquisition Studies

51 Pages Posted: 22 Apr 2008 Last revised: 24 Jan 2009

See all articles by Fabian Homberg

Fabian Homberg

University of Zurich - Institute for Organization and Administrative Science

Katja Rost

University of Zurich - Institute for Organization and Administrative Science

Margit Osterloh

University of Basel; Professor (em.) University of Zurich

Date Written: April 22, 2008

Abstract

Mergers and Acquisitions (M&A) aim to increase wealth for shareholders of the acquiring company, in particular by creating synergies. It is often assumed that relatedness is a source of synergies. Our study distinguishes between business, cultural, technological and size relatedness. It discusses the reasons why these different forms of relatedness can lead to an acquisition success and conducts a meta-analysis of 67 prior M&A studies. Results indicate that positive effects can be expected under specific conditions only and have a limited overall impact on acquisition success. A moderator analysis finds that synergies stemming from relatedness depend on industry-, country-, and investor-characteristics.

Keywords: M&A, acquisitions, synergies, meta-analysis, managerialism, hubris

JEL Classification: G34, G31, G24, G12, D82

Suggested Citation

Homberg, Fabian and Rost, Katja and Osterloh, Margit, Do Synergies Exist in Related Acquisitions? A Meta-Analysis of Acquisition Studies (April 22, 2008). Available at SSRN: https://ssrn.com/abstract=1123882 or http://dx.doi.org/10.2139/ssrn.1123882

Fabian Homberg

University of Zurich - Institute for Organization and Administrative Science ( email )

Plattenstrasse 14
CH-8032 Zurich
Switzerland

Katja Rost

University of Zurich - Institute for Organization and Administrative Science ( email )

Plattenstrasse 14
CH-8032 Zurich
Switzerland

Margit Osterloh (Contact Author)

University of Basel ( email )

Petersplatz 1
Basel, CH-4003
Switzerland

Professor (em.) University of Zurich ( email )

Südstrasse 11
Zürich, CH-8008
Switzerland

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