South Asian Journal of Management

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The Effect of Cross-Border Mergers and Acquisitions on Shareholder Wealth:Evidence from Indian High-technology Industry


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1 Department of Business Administration, Mangalore University, Mangalagangothri 574199, Karnataka, India
     

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This paper examines the shareholder wealth effects of acquirers as well as targets involved in the Cross-Border Mergers &Acquisitions (CB M&As) by employing event study methodology. A sample of 53 outbound CB M&As and 37 inbound CB M&As occurred in the Indian high-technology industry during the period January 1, 2000 to March 31, 2016 has been used. We find that CB M&As do create wealth for the shareholders of acquirers and the target companies in the short-run. It is also observed that the target company shareholders’ wealth effect is significantly higher than the wealth effect of acquirer company shareholders.

Keywords

CB M&As, Event Study Methodology, High-Technology Industry, India, Wealth Effects.
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  • The Effect of Cross-Border Mergers and Acquisitions on Shareholder Wealth:Evidence from Indian High-technology Industry

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Authors

P. K. Ranju
Department of Business Administration, Mangalore University, Mangalagangothri 574199, Karnataka, India
T. Mallikarjunappa
Department of Business Administration, Mangalore University, Mangalagangothri 574199, Karnataka, India

Abstract


This paper examines the shareholder wealth effects of acquirers as well as targets involved in the Cross-Border Mergers &Acquisitions (CB M&As) by employing event study methodology. A sample of 53 outbound CB M&As and 37 inbound CB M&As occurred in the Indian high-technology industry during the period January 1, 2000 to March 31, 2016 has been used. We find that CB M&As do create wealth for the shareholders of acquirers and the target companies in the short-run. It is also observed that the target company shareholders’ wealth effect is significantly higher than the wealth effect of acquirer company shareholders.

Keywords


CB M&As, Event Study Methodology, High-Technology Industry, India, Wealth Effects.

References