THE FINANCIAL CHARACTERISTICS OF U.S. COMPANIES ACQUIRED BY FOREIGN COMPANIES

Ozge Uygur, Gulser Meric and Ilhan Meric

Global Journal of Business Research, 2013, vol. 7, issue 1, 1-8

Abstract: The number of cross-border mergers and acquisitions has increased considerably after the 2007-2008 financial crisis. However, the post-crisis M&A market has not been studied sufficiently. In this paper, we compare the financial characteristics of the U.S. companies acquired by foreign companies with a matched sample of non-acquired U.S. companies during the post-crisis period. Supporting the findings of the prior literature, we provide evidence that acquiring companies tend to target mismanaged firms with low profitability. We also find that liquidity is not a significant factor in the acquisition decisions of foreign buyers. This paper is one of the first attempts to empirically examine the post-crisis M&A market, which may encourage more future research on the subject.

Keywords: 2007-2008 Financial Crisis; Acquisition Target; Foreign Predator; Financial characteristics; Liquidity; Asset Management; Profitability; MANOVA; Liquidity (search for similar items in EconPapers)
JEL-codes: G11 G15 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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