Cross-border acquisitions: Do labor regulations affect acquirer returns?

Ross Levine (), Chen Lin and Beibei Shen ()
Additional contact information
Beibei Shen: Shanghai University of Finance and Economics

Journal of International Business Studies, 2020, vol. 51, issue 2, No 3, 194-217

Abstract: Abstract Do cross-country differences in labor regulations shape (1) acquiring firms’ announcement returns and post-acquisition profits, costs, and revenues from cross-border deals, (2) the selection of cross-border targets, or (3) the success rates of cross-border offers? We discover that acquiring firms enjoy smaller abnormal returns and post-deal performance gains with targets in stronger labor protection countries; acquirers are more likely to purchase labor-dependent targets in weak labor regulation countries and more likely to use cross-border acquisitions to enter new markets when targets are in stronger labor regulation countries; and offer success rates fall when targets are in stronger labor regulation countries.

Keywords: cross-border mergers and acquisitions; multinational firms; international business; labor standards; labor market regulations (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
http://link.springer.com/10.1057/s41267-019-00281-1 Abstract (text/html)
Access to full text is restricted to subscribers.

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:pal:jintbs:v:51:y:2020:i:2:d:10.1057_s41267-019-00281-1

Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/41267/PS2

DOI: 10.1057/s41267-019-00281-1

Access Statistics for this article

Journal of International Business Studies is currently edited by John Cantwell

More articles in Journal of International Business Studies from Palgrave Macmillan, Academy of International Business
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().