The role of investment banks on the impact of firm performance in mergers and acquisitions: evidence from the Asia-Pacific market

Kai-Shi Chuang ()
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Kai-Shi Chuang: Tunghai University

Review of Quantitative Finance and Accounting, 2017, vol. 48, issue 3, No 4, 677-699

Abstract: Abstract This study uses a comprehensive sample of 5271 bidders during the period of 1995–2011 to examine the role of financial advisors on the outcomes of mergers and acquisitions in the Asia Pacific market. The results indicate that bidders take more time to complete deals when hiring tier-3 advisors. In addition, the empirical evidence indicates that bidders obtain higher announcement returns when hiring low reputation financial advisors. The results are robust when controlling for year effects, country effects and self-selection bias. In addition, the regression analysis also reveals that bidders obtain lower post-announcement returns when hiring tier-1 advisors in domestic deals. Thus, the empirical findings illustrate the importance of the quality of financial advisors on firm performance in mergers and acquisitions in the Asia Pacific market.

Keywords: Mergers and acquisitions; Investment banks; Announcement returns (search for similar items in EconPapers)
JEL-codes: G21 G34 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (6)

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DOI: 10.1007/s11156-016-0564-2

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