Growing Through M&A:Impact Analysis of Acquisitions in IT Industry

To understand the performance of firms post-M&As an empirical study is done using a derived regression model based on the financial and firm level economic data for the leading IT/ITeS industries. The effort is to determine the relationship of the M&As to the firm’s profitability. This study arrives at a model to determine the effect of M&As on the economic factors like ROA and CAR of the firms. The evidence is to support that M&As are not a solution to the financial distress in corporate organizations. The research revealed that while M&As can drive profitability in some organizations, operating efficiency suffers at least in the short-term in the post-M&A corporate entity.