The post-merger performance of Greek acquiring listed firms : an accounting analysis
Part of : MIBES Transactions : international journal ; Vol.4, No.1, 2010, pages 96-107
Issue:
Pages:
96-107
Abstract:
One of the main elements of contemporary corporate restructuring, with a universal acceptance, is the formation of new business entities via mergers and acquisitions (M&As). This study examines the impact of M&As on the operating performance of mergerinvolved firms in Greece. From a sample of 560 M&As transactions in the period from 2003 to 2005 are examined only forty of them as they concern companies listed on the Athens Stock Exchange, which had executed at least one merger or acquisition as acquirers during this period. At this sample of forty Greek firms their post-merger performance is investigated using accounting data. For the purpose of the study, a set of ten accounting ratios is employed in order to measure firms' operating performance comparing pre- and post-merger operating performance for two years before and after the M&A announcements. The results revealed that two (current ratio, total debt ratio) out of the ten accounting ratios had change significantly due to the M&A event two years later; the first increased and the second decreased, respectively. The rest eight ratios, including two examined profitability ratios, did not change significantly. Also, concerning the analysis of the same M&As events in different time intervals, this study concludes that the exact time of merger actions have influenced with a different relative change the post-merger performance of acquiring firms. The final conclusion that conducted is that M&As have had a particular impact (positive and negative) on post-merger operating performance of merger-involved firms only at some specific accounting ratios.
Subject:
Subject (LC):
Keywords:
mergers, acquisitions, accounting ratios, operating performance
Notes:
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