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Motives for Mergers and Acquisitions under Turbulent and Liquidity-Scarce Environment: Learning from Korean Cases

Seong-Ho Cho
경영연구소 (Management Research Center)|2007.12|Seoul Journal of Business|제13권 제2호|pp. 35-58|DOI 10.35152/snusjb.2007.13.2.002

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참고문헌

키워드

event studycredit crunchKorean mergers and acquisitionsoperational synergygrowth synergy

초록

This paper attempts an explanation of shareholder wealth creation for bidders and targets in terms of synergy factors under turbulent and liquidity-scarce environment, in which Korean mergers and acquisitions have experienced during 1996-2006. While extant empirical literature documents based upon the US cases that target firms shareholders gain substantially whereas those of bidding firms do not, our findings indicate that in contrast in the case of Korean mergers and acquisitions the shareholders of targets do not gain and at worst lose and that thoseof bidders gain. The results suggest that a motive for mergers and acquisitions under turbulent and liquidity-scarce environment could be associated with successful firms growth strategy into related business utilizing their rich cash-base in acquiring available good targets atcheaper premium.

Abstract

This paper attempts an explanation of shareholder wealth creation for bidders and targets in terms of synergy factors under turbulent and liquidity-scarce environment, in which Korean mergers and acquisitions have experienced during 1996-2006. While extant empirical literature documents based upon the US cases that target firms shareholders gain substantially whereas those of bidding firms do not, our findings indicate that in contrast in the case of Korean mergers and acquisitions the shareholders of targets do not gain and at worst lose and that thoseof bidders gain. The results suggest that a motive for mergers and acquisitions under turbulent and liquidity-scarce environment could be associated with successful firms growth strategy into related business utilizing their rich cash-base in acquiring available good targets atcheaper premium.

참고문헌 (25)

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관련 논문AI추천

The Effect of Target Ownership Structure in the Wealth Gains in Owner-Manager Dominant Acquisitions: Evidence from Korean Cases조성호경영연구소 · Seoul Journal of Business2009 · 제15권 제1호Does a parent-subsidiary merger enhance efficiency in Korea김창기, 정헌용, 조경식대한경영정보학회 · 경영과 정보연구2010 · 제29권 제3호Stock Price Reactions to M&A Market Events in Korea김영산경제연구소 · Journal of Economic Research (JER)2007 · 제12권 제1호Determinants of Cross Border M&As: The Experience of Korea and the Role of Trade Cost윤미경한국질서경제학회 · 질서경제저널2012 · 제15권 제3호Internationalization, Regulation, and Diversification Effect in Cross-border M&A : Evidence from KOSPI Market김병진, 정진영, 조성우한국금융공학회 · 金融工學硏究2021 · 제20권 제2호A Research on the Determinants of Diversification of Korean Firms around the Occasion of Asian Financial Crisis권택호, 이장우, Sung C. Bae한국금융공학회 · 金融工學硏究2007 · 제6권 제2호

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