Do Acquisitions and Mergers Improve Corporate Performance: Evidence from Chinese Listed Companies

CHEN, Yuhong (2016) Do Acquisitions and Mergers Improve Corporate Performance: Evidence from Chinese Listed Companies. [Dissertation (University of Nottingham only)]

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Abstract

Abstract

During the last decade, Chinese M&A activities have experienced a dramatic upward trend. Increasing scholars investigate Chinese M&A and test the influence of Chinese acquisitions and mergers on firms’ post-merger performance. However, their studies about the impact of M&A activities on firms’ post-merger performance are still mixed. This paper includes sample data of 743 Chinese M&A deals that took place during the period of 2000 to 2010. Industry adjusted operating cash flows on assets, operating margin, ROA and ROE were used as measures to capture post-merger performance. We test the influence of M&A activities on post-merger performance and also examine the determinants that might influence the post-merger performance. Cross-sectional regression models are used to capture the abnormal industry adjusted returns and sample OLS regression models are used to test the relationship between the post-merger performance and its determinant factors. Empirical results shows that merged firms have improve their post-merger performance significant for the first three years after acquisitions, however, for the long-term, M&A does not improve merged firms’ performance. Besides, regression results reports that mergers within the same industry will improve the post-merger performance for both short and long term; target profitability would significantly improve post-merger performance for the short-term; high level of leverage will depress the post-merger performance for both short and long term; relative size has significant negative influence on post-merger performance for the short-term and this influence becomes positive for the long-run.

Item Type: Dissertation (University of Nottingham only)
Keywords: M&A, posr-merger performance
Depositing User: Chen, Yuhong
Date Deposited: 10 Mar 2017 15:53
Last Modified: 14 Mar 2017 11:47
URI: http://eprints.nottingham.ac.uk/id/eprint/36389

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