ANALYSIS OF POST-MERGER PERFORMANCE OF MERGED ENTITY: A STUDY OF SELECT FINANCIAL SECTOR DEALS
Keywords:
Mergers and Acquisition, Performance, Financial Sector, PCA, Paired T-Test.
Abstract
Mergers and acquisitions are considered to be significant business plans among all other options of expansion that help a company develop outside and provide it a strategic edge. In the last half-century, this field has created a great volume of research and literature, particularly in the industrialized countries. Available literature evaluating long-term success of businesses after mergers in both established and emerging markets have not yet been likely to assess a definitive and assertive conclusion regarding whether combinations improved or hampered company profitability. This study undertook a sample of 23 companies merging between 2005 to 2015 where the target or acquirer is from the financial sector. PCA have applied to reduce the number of variables used in the analysis because of high correlation among the variables and paired T-test have been used to assess the impact of mergers. Significant change in results can only be seen for just a few companies and finding could not lead to concrete conclusion.
JEL Classification Codes: G34, N2.
References
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Dogru, T., Erdogan, A., & Kizildag, M. (2018). Marriott Starwood merger: what did we learn from a financial standpoint? Journal of Hospitality and Tourism Insights, 1(2), 121–136. https://doi.org/10.1108/jhti-10-2017-0009
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Ghosh, M. S., & Dutta, S. (2014). Mergers and Acquisitions: A Strategic Tool for Restructuring in the Indian Telecom Sector. Procedia Economics and Finance, 11(14), 396–409. https://doi.org/10.1016/s2212-5671(14)00207-x
Grigorieva, S., & Petrunina, T. (2015). The performance of mergers and acquisitions in emerging capital markets: new angle. Journal of Management Control, 26(4), 377–403. https://doi.org/10.1007/s00187-015-0219-9
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Published
2022-03-15
How to Cite
Kalsie, A., & Singh, I. (2022). ANALYSIS OF POST-MERGER PERFORMANCE OF MERGED ENTITY: A STUDY OF SELECT FINANCIAL SECTOR DEALS. International Journal of Accounting & Finance Review, 10(1), 61-75. https://doi.org/10.46281/ijafr.v10i1.1656
Section
Research Paper/Theoretical Paper/Review Paper/Short Communication Paper
Copyright (c) 2022 Anjala Kalsie, Inderpal Singh
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