Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach
The central proposition of this paper is to assess the performance of cross-border acquisitions made by Multilatinas. Applying the event study method to a sample of 607 announcements of acquisitions during the period 1989-2011 by 182 Multilatinas from Argentina, Brazil, Chile, Colombia, Mexico, Peru...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)
2013-10-01
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| Series: | BAR: Brazilian Administration Review |
| Subjects: | |
| Online Access: | http://www.anpad.org.br/periodicos/arq_pdf/a_1425.pdf |
| _version_ | 1797971712261750784 |
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| author | Paulo Roberto Feldmann Leon Chant Dakessian |
| author_facet | Paulo Roberto Feldmann Leon Chant Dakessian |
| author_sort | Paulo Roberto Feldmann |
| collection | DOAJ |
| description | The central proposition of this paper is to assess the performance of cross-border acquisitions made by Multilatinas. Applying the event study method to a sample of 607 announcements of acquisitions during the period 1989-2011 by 182 Multilatinas from Argentina, Brazil, Chile, Colombia, Mexico, Peru and Venezuela, we conclude that: (a) on average, these announcements have a neutral impact on the short-term returns to acquiring companies’ shareholders; (b) cross-sectional analysis reveals that relative size of the deals have anegative and significant effect on investors’ reactions and; (c) unlike the institutional distance between home and host countries, cultural distance matters, since it has a negative and significant effect on the perceptions that investors have regarding the expected economic impact of acquirers’ cross-border merger and acquisition(M&A) decisions. Inasmuch as the market rationality assumption that underlies the event study method has been questioned, future research lines are proposed in order to search for alternative long-term performance constructs concerning M&A processes in general that can: (a) shed light on the reality of value creation (and destruction) from cross-border acquisitions made by Multilatinas; and (b) contribute to strategy, international business and M&A theories and practice. |
| first_indexed | 2024-04-11T03:36:54Z |
| format | Article |
| id | doaj.art-a3f0f83953684b6182e3bbfa6f550c31 |
| institution | Directory Open Access Journal |
| issn | 1807-7692 |
| language | English |
| last_indexed | 2024-04-11T03:36:54Z |
| publishDate | 2013-10-01 |
| publisher | Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD) |
| record_format | Article |
| series | BAR: Brazilian Administration Review |
| spelling | doaj.art-a3f0f83953684b6182e3bbfa6f550c312023-01-02T04:58:46ZengAssociação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)BAR: Brazilian Administration Review1807-76922013-10-01104462489Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study ApproachPaulo Roberto FeldmannLeon Chant DakessianThe central proposition of this paper is to assess the performance of cross-border acquisitions made by Multilatinas. Applying the event study method to a sample of 607 announcements of acquisitions during the period 1989-2011 by 182 Multilatinas from Argentina, Brazil, Chile, Colombia, Mexico, Peru and Venezuela, we conclude that: (a) on average, these announcements have a neutral impact on the short-term returns to acquiring companies’ shareholders; (b) cross-sectional analysis reveals that relative size of the deals have anegative and significant effect on investors’ reactions and; (c) unlike the institutional distance between home and host countries, cultural distance matters, since it has a negative and significant effect on the perceptions that investors have regarding the expected economic impact of acquirers’ cross-border merger and acquisition(M&A) decisions. Inasmuch as the market rationality assumption that underlies the event study method has been questioned, future research lines are proposed in order to search for alternative long-term performance constructs concerning M&A processes in general that can: (a) shed light on the reality of value creation (and destruction) from cross-border acquisitions made by Multilatinas; and (b) contribute to strategy, international business and M&A theories and practice.http://www.anpad.org.br/periodicos/arq_pdf/a_1425.pdfinternationalizationinternalization theoryevent studymultilatinasabnormal returns. |
| spellingShingle | Paulo Roberto Feldmann Leon Chant Dakessian Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach BAR: Brazilian Administration Review internationalization internalization theory event study multilatinas abnormal returns. |
| title | Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach |
| title_full | Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach |
| title_fullStr | Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach |
| title_full_unstemmed | Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach |
| title_short | Multilatinas and Value Creation from Cross-Border Acquisitions: An Event Study Approach |
| title_sort | multilatinas and value creation from cross border acquisitions an event study approach |
| topic | internationalization internalization theory event study multilatinas abnormal returns. |
| url | http://www.anpad.org.br/periodicos/arq_pdf/a_1425.pdf |
| work_keys_str_mv | AT paulorobertofeldmann multilatinasandvaluecreationfromcrossborderacquisitionsaneventstudyapproach AT leonchantdakessian multilatinasandvaluecreationfromcrossborderacquisitionsaneventstudyapproach |