Post-M&A Performance and Failure: Implications of Time Until Deal Completion
Sustainability, 12(7):2999, https://doi.org/10.3390/su12072999
31 Pages Posted: 23 Jun 2020 Last revised: 10 Oct 2022
Date Written: April 8, 2020
Firm values change substantially between deal announcement and closing, risking renegotiation or termination. For deals that eventually close, does waiting longer to close benefit the acquirer post-M&A? We investigate whether the time that elapses until deal completion is an indicator of post-M&A performance and failure. We find that deals taking an optimum time to implement perform better, supporting the due diligence hypothesis, while taking too long to close is an indication of poor post-M&A performance and subsequent failure, supporting the overdue hypothesis.
Keywords: M&A performance, M&A failure, time until deal completion, due diligence hypothesis, overdue hypothesis
JEL Classification: G34, G33
Suggested Citation: Suggested Citation