Characteristics of Acquirers and Targets in Domestic and Cross‐Border Mergers and Aquisitions

20 Pages Posted: 18 Jul 2013

See all articles by Qing Liu

Qing Liu

University of International Business and Economics (UIBE)

Larry D. Qiu

The University of Hong Kong - Faculty of Business and Economics; Hong Kong University of Science & Technology (HKUST) - Department of Economics

Date Written: August 2013

Abstract

To help understand mergers and acquisitions (M&As), this paper utilizes the most recent M&A data (1991–2007) to establish empirical facts on a variety of performance measures for M&A acquirers, targets, and non‐participants. Unlike the finance literature which mainly focuses on abnormal returns, our performance measures include firm size, technology, productivity, and profitability. Generally, in domestic M&As, in cross‐border M&As, in the pre‐merger period and in the post‐merger period, acquirers perform better than targets, whereas targets perform better than non‐participants. Firms' performance is improved after the M&As. We also find that in the pre‐merger period, US firms that acquire foreign firms in developing countries are significantly better than those that acquire foreign firms in developed countries.

Suggested Citation

Liu, Qing and Qiu, Larry Dongxiao, Characteristics of Acquirers and Targets in Domestic and Cross‐Border Mergers and Aquisitions (August 2013). Review of Development Economics - Special Issue. Guest Editor: Zhihao Yu, Vol. 17, Issue 3, pp. 474-493, 2013. Available at SSRN: https://ssrn.com/abstract=2295277 or http://dx.doi.org/10.1111/rode.12044

Qing Liu

University of International Business and Economics (UIBE)

10, Huixin Dongjie
Changyang District
Beijing, Beijing 100029
China

Larry Dongxiao Qiu

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Hong Kong University of Science & Technology (HKUST) - Department of Economics ( email )

School of Economics and Finance
University of Hong Kong
Pokfulam
Hong Kong

HOME PAGE: http://www.bm.ust.hk/~larryqiu/

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