The Impact of Country-level Characteristics on Cross-Border Merger and Acquisition Premiums

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Date
2016-09-28Author
Shedden, Myles D 1987-
Type
ThesisDegree Level
MastersMetadata
Show full item recordAbstract
It is observed that merger premiums vary across countries. In this paper we study the impact of country-level characteristics on cross-border merger and acquisition premiums. By using principal component analysis to combine several existing country-level indices, we provide empirical evidence that stronger measures of legal and regulatory standards, investor protection, and corporate transparency lead to higher merger premiums in cross-border transactions. The results indicate that managers of the acquiring firm are willing to pay a higher premium to acquire a foreign target when they believe the risks of achieving merger synergies are lower, and that the market for corporate control is not an effective substitute for a formal legal and regulatory system that protects shareholders.
Degree
Master of Science (M.Sc.)Department
FinanceProgram
FinanceCommittee
Maung, Min; Wilson, Craig; Mamun, Abdullah; Zhang, ZhouCopyright Date
October 2016Subject
Cross-border M&A
Country-level Characteristics
Premiums
Corporate Valuation
Corporate Governance