SYNERGIES FROM MERGERS AND ACQUISITIONS: CASE STUDIES

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Alexander, Joby (2006) SYNERGIES FROM MERGERS AND ACQUISITIONS: CASE STUDIES. [Dissertation (University of Nottingham only)] (Unpublished)

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Abstract

Despite the seemingly high risks attached, Mergers and Acquisitions (M&A) have been around for almost a century and have been used as an important tool in the growth strategy of a company. Empirical evidence on the creation of value through M&A activity has shown diverse results. Drawing upon this framework, this dissertation aims to identify whether value has been created or destroyed by undertaking merger activity.

An attempt is made to investigate the outcome of the merger and evaluate the effects of merger on both the firm and the shareholder. A case study of two diverse companies supplemented by a literature review is undertaken to see whether, both these entities have benefited from the merger. Theoretically, Mergers and acquisitions are assumed to improve the performance of the company through expense reduction, synergies, economies of scale and other factors. Empirical evidence on the value added to the shareholders of the merged firms varies from positive to negative. In the case studies undertaken, the results from accounting studies show that the firm's performance has improved thereby creating value for the firm. However, wealth gains to the shareholders of the merged companies calculated, using the Market Model, show negative abnormal returns.

Item Type: Dissertation (University of Nottingham only)
Keywords: Synergies, Mergers, Acquisitions, Case Studies, Finance, Investment
Depositing User: EP, Services
Date Deposited: 05 Jan 2007
Last Modified: 21 Dec 2017 02:03
URI: https://eprints.nottingham.ac.uk/id/eprint/20773

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