Jaipuria International Journal of Management Research

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Comparative Pre and Post Merger Financial Analysis of Selected Indian Pharmaceutical Companies


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1 STEP—HBTI, HBTU Campus, Nawab Ganj, Kanpur (Uttar Pradesh), India
     

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A business may grow either by internal expansion or by external expansion. The focus of this paper is to study external expansion. A firm acquires a running business and grows overnight through corporate combinations, most common of these, is in the form of mergers and acquisitions. This study is an exploratory study, and through this paper an attempt is made to find an impact of acquisition on liquidity, solvency & financial risk, profitability and profitability of the acquiring company post merger as compared with pre period. For the purpose out of total 14 mergers, 10 mergers happening between the year 2000-01 to 2013-14, have been taken up for the study. A 3 year pre and post data of total of 17 variables of each of the selected mergers are taken from CMIE PROWESS 4.15 database and paired sample t-test is conducted (on statistical software of SPSS) to test the four hypothesis framed to fulfill the objectives of the study. Through this study it can be concluded that there is significant difference in liquidity post merger as compared with pre, but there is no significant difference in solvency& financial risk, profitability and operational efficiency for the sample of selected mergers.

Keywords

Mergers & Acquisitions, Target Company, Liquidity, Profitability, Operational Efficiency.
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  • Comparative Pre and Post Merger Financial Analysis of Selected Indian Pharmaceutical Companies

Abstract Views: 543  |  PDF Views: 1

Authors

Suchita Shukla
STEP—HBTI, HBTU Campus, Nawab Ganj, Kanpur (Uttar Pradesh), India

Abstract


A business may grow either by internal expansion or by external expansion. The focus of this paper is to study external expansion. A firm acquires a running business and grows overnight through corporate combinations, most common of these, is in the form of mergers and acquisitions. This study is an exploratory study, and through this paper an attempt is made to find an impact of acquisition on liquidity, solvency & financial risk, profitability and profitability of the acquiring company post merger as compared with pre period. For the purpose out of total 14 mergers, 10 mergers happening between the year 2000-01 to 2013-14, have been taken up for the study. A 3 year pre and post data of total of 17 variables of each of the selected mergers are taken from CMIE PROWESS 4.15 database and paired sample t-test is conducted (on statistical software of SPSS) to test the four hypothesis framed to fulfill the objectives of the study. Through this study it can be concluded that there is significant difference in liquidity post merger as compared with pre, but there is no significant difference in solvency& financial risk, profitability and operational efficiency for the sample of selected mergers.

Keywords


Mergers & Acquisitions, Target Company, Liquidity, Profitability, Operational Efficiency.

References





DOI: https://doi.org/10.22552/jijmr%2F2017%2Fv3%2Fi2%2F162939