The Effect Of Cross-Border And Domestic Acquisitions On Shareholder Wealth: Evidence From Brics Acquirers

Аннотация

Авторы: Светлана Александровна Григорьева НИУ ВШЭ grigorievasa@mail.ru

The topic devoted to cross-border M&A performance has received wide attention in  academic literature. Most existing studies examine wealth effects of international M&As in developed countries. We contribute to existing research by examining the market reaction to the announcements of M&As initiated by companies from BRICS countries over 2000–2012. We assess the long-term performance of M&A deals along with the short-term one and provide a copmarative analysis of company wealth gains in cross-border and domestic M&As.  Based on the sample of 117 cross-border deals and 247 domestic M&As we find that foreign acquisitions outperform the domestic ones in the long run. We also find that main determinants of M&A performance are the acquirer’s FCFF, percentage change in the acquiring country's exchange rate against the target country currency during the acquisition year, and the level of international diversification of acquirers.