Characteristics of Acquirers and Targets in Domestic and Cross-border M&As

Review of Development Economics, 2013, 17(3): 474–493

Posted: 18 May 2021

See all articles by Qing Liu

Qing Liu

Renmin University of China

Larry D. Qiu

The University of Hong Kong - Faculty of Business and Economics; Hong Kong University of Science & Technology (HKUST) - Department of Economics

Date Written: 2013

Abstract

To help understand mergers and acquisitions (M&As), this paper utilizes the most recent M&A data (1991–2007) to establish empirical facts on a variety of performance measures for M&A acquirers, targets, and non-participants. Unlike the finance literature which mainly focuses on abnormal returns, our performance measures include firm size, technology, productivity, and profitability. Generally, in domestic M&As, in cross-border M&As, in the pre-merger period and in the post-merger period, acquirers perform better than targets, whereas targets perform better than non-participants. Firms' performance is improved after the M&As. We also find that in the pre-merger period, US firms that acquire foreign firms in developing countries are significantly better than those that acquire foreign firms in developed countries.

Suggested Citation

Liu, Qing and Qiu, Larry Dongxiao, Characteristics of Acquirers and Targets in Domestic and Cross-border M&As (2013). Review of Development Economics, 2013, 17(3): 474–493, Available at SSRN: https://ssrn.com/abstract=3846327

Qing Liu (Contact Author)

Renmin University of China ( email )

Larry Dongxiao Qiu

The University of Hong Kong - Faculty of Business and Economics ( email )

Pokfulam Road
Hong Kong
China

Hong Kong University of Science & Technology (HKUST) - Department of Economics ( email )

School of Economics and Finance
University of Hong Kong
Pokfulam
Hong Kong

HOME PAGE: http://www.bm.ust.hk/~larryqiu/

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