The Timing of Acquisition in an Industry Merger Wave: Analysis of Wealth Effects on Rivals Suppliers and Customers

  • 魏 希妮

Student thesis: Doctoral Thesis


Although most of the research in merger and acquisition indicate insignificant or negative acquisition returns to acquiring firms studies in merger waves contend that the acquisition position within a wave could significantly influence the consequences Specifically early moving acquirers within merger waves can gain from acquisitions However to the extent of my knowledge none of the extant studies focused on investigating the influence of the acquisition position on the non-integrated rival firms as well as firms along the supply chain This study aims not only to fill this gap but also examine whether the effects of positioning within a wave on rival supplier and customer return are different between horizontal and vertical integrations After identifying industry merger waves and acquisition positions using the data from the SDC Mergers and Acquisitions database horizontal and vertical integrations as well as rival supplier and customer industries are classified by using the commodity flows between each pair of input-output (IO) industries from the Use table of Benchmark Input-Output Accounts Afterwards the event study methodology is performed using market return data from the CRSP Cross-sectional analysis are conducted to investigate a curvilinear relation between the acquisition positions and the wealth of rivals suppliers and customers as well as the influences of horizontal and vertical acquisition positions The results indicate that the decisions to participate in an industry merger wave by an acquirer can propagate the effects through the other nonintegrated firms competing in the same industry as well as firms along the supply chain Specifically the statistically significant curvilinear relationships between the acquisition positions within an industry merger wave and the wealth of rivals main supplier and main customers are reported only in the full sample and subsample of vertical merger and acquisition Particularly the results disclose a statistically significant relationship in a U shaped pattern between the acquisition position and the wealth of rivals For main suppliers and customers the results depict the statistically significant influences of the acquisition positions on the wealth of suppliers and customers in an inverted U-shaped pattern
Date of Award2018 Jul 23
Original languageEnglish
SupervisorShao-Chi Chang (Supervisor)

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