Merger waves, entry-timing, and cross-border acquisition completion: A frictional lens perspective

Mohammad Fuad and Ajai S. Gaur

Journal of World Business, 2019, vol. 54, issue 2, 107-118

Abstract: We study the impact of deal announcement and entry-timing within a cross-border acquisition (CBA) wave on the likelihood of acquisition completion. Drawing upon the frictional lens perspective, we identify two types of frictional forces- wave-friction and partner-friction within merger waves. We follow a simulation-based methodology and identify three CBA waves for Indian acquirers between 1995 and 2015. Our findings suggest that acquisition announcement within a merger wave as compared to outside of a wave is negatively related to the likelihood of deal completion. Further, within a merger wave, we find an inverted U-shaped relationship between entry-timing and the likelihood of deal completion.

Keywords: Deal abandonment; Entry-timing; Cross-border merger and acquisition waves; Emerging markets (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (29)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:worbus:v:54:y:2019:i:2:p:107-118

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DOI: 10.1016/j.jwb.2018.12.001

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