We thank financial support from HKU's Seed Funding.
Characteristics of Acquirers and Targets in Domestic and Cross-border Mergers and Aquisitions
Version of Record online: 17 JUL 2013
© 2013 John Wiley & Sons Ltd
Review of Development Economics
Special Issue. Guest Editor: Zhihao Yu
Volume 17, Issue 3, pages 474–493, August 2013
How to Cite
Liu, Q. and Qiu, L. D. (2013), Characteristics of Acquirers and Targets in Domestic and Cross-border Mergers and Aquisitions. Review of Development Economics, 17: 474–493. doi: 10.1111/rode.12044
- Issue online: 17 JUL 2013
- Version of Record online: 17 JUL 2013
- HKU's Seed Funding
To help understand mergers and acquisitions (M&As), this paper utilizes the most recent M&A data (1991–2007) to establish empirical facts on a variety of performance measures for M&A acquirers, targets, and non-participants. Unlike the finance literature which mainly focuses on abnormal returns, our performance measures include firm size, technology, productivity, and profitability. Generally, in domestic M&As, in cross-border M&As, in the pre-merger period and in the post-merger period, acquirers perform better than targets, whereas targets perform better than non-participants. Firms' performance is improved after the M&As. We also find that in the pre-merger period, US firms that acquire foreign firms in developing countries are significantly better than those that acquire foreign firms in developed countries.