Merger Waves, Entry-Timing, and Cross-Border Acquisition Completion: A Frictional Lens Perspective

Journal of World Business, Forthcoming

45 Pages Posted: 20 Jan 2019

See all articles by Mohammad Fuad

Mohammad Fuad

Lucknow, Indian Institute of Management (IIM), Lucknow

Ajai Gaur

Rutgers Business School - Newark and New Brunswick

Date Written: December 10, 2018

Abstract

We study the impact of deal announcement and entry-timing within a cross-border acquisition (CBA) wave on the likelihood of acquisition completion. Drawing upon the frictional lens perspective, we identify two types of frictional forces- wave-friction and partner-friction within merger waves. We follow a simulation-based methodology and identify three CBA waves for Indian acquirers between 1995 and 2015. Our findings suggest that acquisition announcement within a merger wave as compared to outside of a wave is negatively related to the likelihood of deal completion. Further, within a merger wave, we find an inverted U-shaped relationship between entry-timing and the likelihood of deal completion.

Suggested Citation

Fuad, Mohammad and Gaur, Ajai S., Merger Waves, Entry-Timing, and Cross-Border Acquisition Completion: A Frictional Lens Perspective (December 10, 2018). Journal of World Business, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3314072

Mohammad Fuad

Lucknow, Indian Institute of Management (IIM), Lucknow ( email )

Lucknow
India

Ajai S. Gaur (Contact Author)

Rutgers Business School - Newark and New Brunswick ( email )

Newark, NJ
United States

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