Merger waves, entry-timing, and cross-border acquisition completion: A frictional lens perspective

Mohammad Fuad, Ajai S. Gaur

Research output: Contribution to journalArticlepeer-review

22 Scopus citations

Abstract

We study the impact of deal announcement and entry-timing within a cross-border acquisition (CBA) wave on the likelihood of acquisition completion. Drawing upon the frictional lens perspective, we identify two types of frictional forces- wave-friction and partner-friction within merger waves. We follow a simulation-based methodology and identify three CBA waves for Indian acquirers between 1995 and 2015. Our findings suggest that acquisition announcement within a merger wave as compared to outside of a wave is negatively related to the likelihood of deal completion. Further, within a merger wave, we find an inverted U-shaped relationship between entry-timing and the likelihood of deal completion.

Original languageEnglish (US)
Pages (from-to)107-118
Number of pages12
JournalJournal of World Business
Volume54
Issue number2
DOIs
StatePublished - Feb 2019

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Finance
  • Marketing

Keywords

  • Cross-border merger and acquisition waves
  • Deal abandonment
  • Emerging markets
  • Entry-timing

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