Corporate serial acquisitions : An empirical test of the learning
نویسندگان
چکیده
Recent empirical papers report a declining trend in the cumulative abnormal return (CAR) of acquirers during an M&A program. Does this necessarily imply that acquiring CEOs are infected by hubris and are not learning from previous mistakes? We first confirm the existence of this declining trend on average. However, we find a positive CAR trend for CEOs likely to be infected by hubris, which is significantly different from the negative trend found for CEOs who are more likely to be rational. We also explore the time between successive deals and find empirical evidence to suggest that many CEOs learn substantially during acquisition programs.
منابع مشابه
Cross Border Mergers and Acquisitions by Indian firms-An Analysis of Pre and Post Merger performance
The corporate sector all over the world is restructuring its operations through different types of consolidation strategies like mergers and acquisitions in order to face challenges posed by the new pattern of globalization, which has led to the greater integration of national and international markets.. The intensity of cross-border operations recorded an unprecedented ...
متن کاملExplorative and Exploitative Learning from External Corporate Ventures
This study examines the antecedents of explorative and exploitative learning from external corporate ventures. We compare different forms of external corporate venturing, namely corporate venture capital investments, alliances, joint ventures, and acquisitions, as alternative avenues for interorganizational learning. Furthermore, we test the effects of multiple relational characteristics on the...
متن کاملThe Mediating Role of Corporate Image on the Relationship between Corporate Social Responsibility and Firm Performance: An Empirical Study
This study attempted to investigate the effects of corporate social responsibility on firm performance. It also tried to identify the mediating role of corporate image on the relationship between corporate social responsibility and firm performance. This research collected data on latent constructs through a questionnaire administered survey of managers across a spectrum of industries in Bangla...
متن کاملAn Empirical Investigation of the Relation between Corporate Sustainability Performance (CSP) and Corporate Value: Evidence from Iran
This study provides an empirical evidence on how Corporate Sustainability Performance (CSP), is reflected in the corporate value. Using a theoretical framework combining Legitimacy theory, Stakeholder theory and Agency theory, a set of hypotheses that relate the corporate value to CSP is examined. For a sample of Iranian firms, 28 components with four dimensions as Community, Environment, Emplo...
متن کاملExecutive Compensation, Hubris, Corporate Governance: Impact on Managerial Risk Taking and Value Creation in UK High-tech and Low-tech Acquisitions
While the traditional agency model assumes managerial risk aversion and underinvestment in high tech opportunities, the behavioural agency model allows for risk seeking by managers leading possibly to over-risky investment. Corporate governance mechanisms can correct both underand overrisky investment thereby ensuring value enhancing high tech acquisitions. Our study builds an empirical optimal...
متن کامل