Measuring the Economic Gains of Mergers and Acquisitions: Is it Time for a Change?

Antonios Antoniou, Philippe Arbour () and Huainan Zhao ()
Additional contact information
Antonios Antoniou: FRT-C Consulting
Philippe Arbour: Lloyds Bank Acquisition Finance, Postal: 33 Old Broad Street, London
Huainan Zhao: Nottingham Business School, Postal: Nottingham, UK, http://www.nottingham.ac.uk/business/lizhz1.html

Journal of Financial Transformation, 2011, vol. 32, 159-168

Abstract: In this paper we review the methods of measuring the economic gains of mergers and acquisitions (M&A). We show that the widely employed event study methodology, whether for short or long event windows, has failed to provide meaningful insight and usable lessons regarding the central question of whether mergers and acquisitions create value. We believe the right way to assess the success and therefore the desirability of M&A is through a thorough analysis of company fundamentals. This will require examining smaller samples of transactions with similar characteristics.

Keywords: Mergers & Acquisitions; Takeovers; Wealth Effect; Value Creation; Event Study; Fundamental Analysis (search for similar items in EconPapers)
JEL-codes: G14 G34 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:jofitr:1456

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