Predicting acquirers of US food and agribusiness firms

Ramyani Mukhopadhyay and Adesoji O. Adelaja

Agribusiness, 2025, vol. 41, issue 1, 60-83

Abstract: To fill an important gap in the literature on acquirer prediction, this paper investigates which factors contribute to the likelihood that a firm will choose to acquire a target company from the United States (US) food and agribusiness industry (FABI). It relies on existing literature and a conceptual model in identifying the determinants of the choice to be an acquirer. Rejecting the pooled ordinary least squares and random‐effects models, the paper estimates a fixed‐effects logistic regression model based on panel data on acquirers and nonacquirers of US FABI (USFABI) target companies. Contrary to the study's various hypotheses, the results suggest that (1) efficiency, profitability, and liquidity do not affect the likelihood of being an acquirer, but that (2) less‐solvent, less‐leveraged, and less‐attractive firms are more likely to become acquirers (possibly to improve their solvency, profitability, and attractiveness). These contradictory results are attributed to the uniqueness of the USFABI sector. The mergers and acquisitions process may therefore be a way for acquirers of USFABI firms to strengthen themselves, not necessarily an expression of their financial strength. This analysis is useful to target companies, acquirers, transaction advisers, investors, regulators, and other merger and acquisition stakeholders. [EconLit Citations: D22, G24, G34, L66, Q14].

Date: 2025
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/agr.21876

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:agribz:v:41:y:2025:i:1:p:60-83

Access Statistics for this article

Agribusiness is currently edited by Ronald W. Cotterill

More articles in Agribusiness from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().