Payment Methods in Mergers and Acquisitions: A Theoretical Framework

2018 ◽  
Vol 8 (1) ◽  
pp. 170 ◽  
Author(s):  
B. P. Bijay Sankar ◽  
N. M. Leepsa
Keyword(s):  
Mergers And Acquisitions ◽  
Payment Method ◽  
Negative Effects ◽  
Empirical Survey ◽  
Payment Methods ◽  
Cash Payment ◽  
Prior Literature ◽  
Future Work ◽  
The Impact ◽  
Selection Of

Purpose: This paper aims to review the prior literature on payment methods in Mergers and Acquisitions (M&As) and summarizing its effects on the performance of companies involved in M&As. This study also attempts to find out various determinants of the payment methods of M&As that affects the decision of payment methods in M&As. Methodology: To carry out the analysis, this study focuses the past literature relating to payment methods in M&As and summarizes the positive and negative effects of different payment methods. The review is carried out by dividing into four parts (i) Literature studies on cash payment method (ii) Literature studies on stock payment method (iii) Literature studies on mixed payment and (iv) Determinants of payment methods. The paper investigates based on the findings of the major studies.Research limitations: The scope of the study is confined to the contemporary review of M&As literature than the empirical survey. The study is focused more on giving suggestions for future work on M&As than providing conclusion. Research Implications: The knowledge gained from this study will help managers from both acquirer and target companies for selection of appropriate payment methods and improve their investment mechanism and strengthen their finances by value creation in M&As. Originality: To the authors’ knowledge this paper is the first attempt to document for summarizing the impact of different payment methods and its determinants of performance of M&As deals.

Does Wrongdoer Reputation Matter? Impact of Auditor-Wrongdoer Performance and Likeability Reputations on Fellow Auditors' Intention to Take Action and Choice of Reporting Outlet

2011 ◽  
Vol 23 (2) ◽  
pp. 207-234 ◽  
Author(s):  
Jesse C. Robertson ◽  
Chad M. Stefaniak ◽  
Mary B. Curtis
Keyword(s):  
Two Dimensions ◽  
Data Availability ◽  
Good Performer ◽  
Reporting Decisions ◽  
Prior Literature ◽  
Reporting Channel ◽  
Channel Preferences ◽  
Main Effects ◽  
The Impact ◽  
Selection Of

ABSTRACT We investigate the effects of auditor-wrongdoer reputations for performance and likeability on fellow auditors' intentions to take action in response to a questionable audit act. We also use this context to explore auditor selection of reporting outlets, when they do choose to take action. In an experiment with 181 auditors, main effects suggest that likeability reputation is a significant determinant of intention to take action, while performance reputation is marginally significant. As expected, interaction results indicate that auditors have the greatest intention to take action against less likeable, poor performers. Contrary to expectations, intention to take action against a more likeable, good performer is no lower than the mixed conditions. Thus, the influence of the two dimensions of reputation is complex. Additionally, we find auditors are more likely to whistle-blow internally than externally, and through non-anonymous outlets than anonymous outlets. Our contributions include exploring the impact of reputation on the actions of third parties, and advancing prior literature by considering the influence of wrongdoer attributes on reporting decisions and auditors' reporting channel preferences. Data Availability: Data are available from the first author upon request.

scholarly journals A Qualitative Study of COVID-19 Distress in University Students

2021 ◽  
pp. 216769682110251
Author(s):  
Samantha G. Farris ◽  
Mindy M. Kibbey ◽  
Erick J. Fedorenko ◽  
Angelo M. DiBello
Keyword(s):  
University Students ◽  
Undergraduate Students ◽  
Mental Health Problems ◽  
Financial Strain ◽  
Public Response ◽  
Viral Spread ◽  
Future Work ◽  
The Impact ◽  
Viral Outbreak ◽  
Selection Of

The psychological effect of the pandemic and measures taken in response to control viral spread are not yet well understood in university students; in-depth qualitative analysis can provide nuanced information about the young adult distress experience. Undergraduate students ( N = 624) in an early US outbreak “hotspot” completed an online narrative writing about the impact and distress experienced due to the COVID-19 pandemic. Data were collected April-May 2020. A random selection of 50 cases were sampled for thematic analysis. Nine themes were identified: viral outbreak distress, fear of virus contraction/transmission, proximity to virus, dissatisfaction with public response, physical distancing distress, social distancing distress, academic and school-related distress, disruptive changes in health behavior and routines, financial strain and unemployment, worsening of pre-existing mental health problems, and social referencing that minimizes distress. Future work is needed to understand the persistence of the distress, in addition to developing methods for assessment, monitoring, and mitigation of the distress.

Mergers and acquisitions: implications for acquirers’ market risk

2019 ◽  
Vol 45 (4) ◽  
pp. 545-562 ◽  
Author(s):  
Sailesh Tanna ◽  
Ibrahim Yousef
Keyword(s):  
Mergers And Acquisitions ◽  
Prior Experience ◽  
Systematic Risk ◽  
Cross Sectional ◽  
Content Type ◽  
Cash Payment ◽  
Increase Risk ◽  
Method Of Payment ◽  
Mean Differences ◽  
The Impact

Purpose The purpose of this paper is to investigate the impact of mergers and acquisitions (M&As) on acquiring company systematic risk using a global sample of 34,221 completed deals that occurred between the years 1977 and 2012, covering 163 countries and 85 industries. Design/methodology/approach Acquirers’ systematic risk (beta) is calculated using the capital asset pricing model. The change in acquirers’ beta post-merger is obtained using event study and tested for mean differences across various sub-categories of deals. Cross-sectional regressions are then performed to test several hypotheses relating to the impact of diversification, method of payment, target status and prior experience on acquirers’ risk. Findings For the overall sample, the evidence suggests that acquirers’ beta tends to increase post-merger, but only in cases where their pre-merger risk is relatively low in relation to the risk of the market. The authors also show that cash payment deals for publicly listed targets contribute to reducing acquirers’ risk while stock payment increase risk. Diversification, whether global or across industry, has no significant impact on risk. On the other hand, for serial acquirers, the risk is increased significantly with more M&As. Originality/value This study contributes in a unique way by providing global evidence on acquirers’ systematic risk using a very large and diverse sample of M&A deals and investigating not only the impact of diversification on risk but also of other deal characteristics (e.g. method of payment, target status, acquirers’ prior experience) which have not been previously examined.

Assessing the Impact of Customer Concentration on Initial Public Offering and Balance Sheet–Based Outcomes

2017 ◽  
Vol 81 (6) ◽  
pp. 42-61 ◽  
Author(s):  
Alok R. Saboo ◽  
V. Kumar ◽  
Ankit Anand
Keyword(s):  
Initial Public Offerings ◽  
Initial Public Offering ◽  
Balance Sheet ◽  
Performance Outcomes ◽  
Customer Relationships ◽  
Negative Effects ◽  
Public Offerings ◽  
Prior Literature ◽  
Public Offering ◽  
The Impact

Using the notion of customer concentration, the authors argue that firms should evenly spread their revenues across their customers, rather than focusing on a few major customer relationships. Prior literature suggests that major customers improve efficiency and provide access to resources, thereby producing positive performance outcomes. However, building on industrial organizational literature and modern portfolio theory, the authors argue that concentration of revenues reduces the supplier firm's bargaining power relative to its customers and hurts the ability of the supplier firm to appropriate value, which, in turn, hurts profits. Using a sample of 1,023 initial public offerings (IPOs) and robust econometric methods, they find that customer concentration reduces investor uncertainty and positively impacts IPO outcomes, but significantly hurts balance sheet–based outcomes (e.g., profitability). The results suggest that a 10% increase in customer concentration reduces profitability by 3.35% (or about $7 million) in the subsequent year, or 9.4% cumulatively over the next four years (or about $20.32 million). Further, the authors find that the negative effects of customer concentration decrease with increase in organizational (marketing, technological, and operational) capabilities and increase with low customer credit quality.

scholarly journals Cash Management: A Shift in Payment Pattern of Indian Buyers during Covid 19

2020 ◽  
Vol 11 (2) ◽  
Author(s):  
Vandana Dhingra
Keyword(s):  
Statistical Tests ◽  
Credit Cards ◽  
Cash Management ◽  
Face To Face ◽  
Online Transactions ◽  
Payment Methods ◽  
Online Payment ◽  
Cash Payment ◽  
Spss Software ◽  
The Impact

Cash Management is always one of the cherished objectives of Planners & Policymakers not only in India but all over the world. The current Covid 19 crisis is the root for a shift in the Alternative payment methods. The usage of non-cash payment methods, such as e-wallets, online transactions using e-banking, debit and credit cards will increase extensively due to the impossibility of doing face to face transactions. People are forced to find alternative ways of shopping in the wake of Coronavirus crisis, and hence there will be a shift in the pattern of purchase (from real shopping to virtual/online shopping) and online payment methods. Not only this, certain payments like mobile recharge, electricity and water bills, municipal taxes, etc. are to be made online. People who were reluctant or slow in adapting to online payment methods have no choice but to adopt the non-traditional payment alternatives (m-wallets, Paytm, NEFT, RTGS, IMPS, etc). The Indian Income Tax act also encourages noncash payments by the customers through Section 44AD, Section 40A(3), to name a few. The paper examines the impact of Covid 19 on the payment pattern of Indian buyers by comparing the two scenarios 1. Before Covid 19, and 2. During Covid 19. The RBI statistic of payment methods from November 2019 to May 2019. To extrac the results, statistical tests like Paired t-test have been used with the help of SPSS software. The results indicate that covid 19 has a vital impact on non-cash payment methods.

Synergy management pitfalls in mergers and acquisitions

2015 ◽  
Vol 53 (7) ◽  
pp. 1469-1503 ◽  
Author(s):  
Raffaele Fiorentino ◽  
Stefano Garzella
Keyword(s):  
Mergers And Acquisitions ◽  
Content Type ◽  
Five Dimensions ◽  
A Value ◽  
Management Literature ◽  
Prior Literature ◽  
Comprehensive Framework ◽  
Compatible Elements ◽  
Practical Implications ◽  
Selection Of

Purpose – The purpose of this paper is to advance a conceptual comprehensive framework to analyze synergy management pitfalls in mergers and acquisitions (M & As). The framework highlights the main dimensions of synergy management, the most relevant synergy pitfalls and the ways to overcome them. Design/methodology/approach – A greater recognition of synergy management literature in M & As is developed. A framework is provided integrating the compatible elements of previous broad areas of research and the main findings of studies on several topics related to synergy. Findings – Prior literature has suggested that synergy is an important motivation of M & As, has tended to be overestimated and has been difficult to achieve. Specifically, there are three relevant synergy pitfalls: the “mirage,” a tendency to overestimate synergy potential, the “gravity hill,” the underestimation of the difficulties in synergy realization and “amnesia,” a dangerous lack of attention to the realization of synergy. An effective synergy management requires an analysis of five dimensions: the steps of the M & A process, the several values of synergy, the forbidding effects of poor synergy management, the potential causes of synergy inflation and the selection of solutions to synergy pitfalls. Practical implications – The comprehensive framework suggests insights and guidelines to help managers to overcome pitfalls in synergy management. Managers will learn the following lessons: “when” pitfalls should embrace synergy management; “where” pitfalls may occur; “why” pitfalls may occur; “what” consequences can result in a value of “realized synergy” lower than the “expected synergy”; and “how” actions, tools and behaviors can overcome hidden dangers in synergy management. Originality/value – The study changes the focus from a single, generic synergy trap to three more analytical, useful synergy pitfalls: the mirage, the gravity hill and the amnesia. By shedding light on synergy management pitfalls, this paper enriches M & A literature and enhance practical solutions to reduce pitfalls in synergy decision making.

scholarly journals HOW COVID-19 PANDEMIC BOOSTS THE EUROPEAN AND UKRAINIAN ELECTRONIC COMMERCE

2021 ◽  
Author(s):  
Оксана Мазоренко
Keyword(s):  
Electronic Commerce ◽  
Inventory Management ◽  
Statistical Information ◽  
Service Availability ◽  
Economic Factors ◽  
Management Communication ◽  
Cash Payment ◽  
Key Drivers ◽  
The Impact ◽  
Selection Of

The article is devoted to current problems of e-commerce development in modern conditions. Today, e-commerce has become not only one of the main areas of the economy, but also an integral part of people's economic and social activities. The article identifies the key drivers of e-commerce – technological, political, social and economic factors. The benefits of electronic commerce were considered as to affect three major stakeholders: organizations, consumers and society. Also, the e-commerce features were defined: non-cash payment; 24/7 service availability; advertising and marketing; improved sales; support; inventory management; communication improvement. It is impossible to discuss 2020 – 2021 in e-commerce without discussing the topic of the COVID19 pandemic. The COVID19 pushed world’s e-commerce sphere to the next level, Europe and Ukraine are no exception. The analysis of statistical information identifies trends in the development of e-commerce in Europe and Ukraine. The article says that European consumers estimate that they have spent 717 billion euros shopping online in 2020, while Ukrainian e-commerce market amounted to about 107 billion UAH. The most popular products purchased online in Europe are clothing and footwear, home electronics and books. The largest segments in Ukrainian e-commerce is electronics and media, fashion, furniture and appliances. The article identifies the global reasons for the growth of e-commerce. Particular attention is paid to the study of the impact of the COVID19 pandemic on the development of e-commerce, which allowed to identify new trends in e-commerce, to investigate changes caused by the pandemic and quarantine in the behavior of consumers and entrepreneurs. In 2021, and in post-COVID19 times, consumer purchasing habits will persist. It is worth noting that the habit of buying online what was previously bought offline will continue to grow, as e-commerce will continue to be the safest type of retail. At the same time, the list of categories of goods purchased online will expand. These trends will allow retailers to create a stable market and consumers to meet their needs through a wide selection of products and unique offers.

scholarly journals The Long-Run Performance of U.S. Bidding Firms in the Post M&A Period: The Impact of Bid Type, Payment Method and Industry Specialisation

2017 ◽  
Vol 12 (2) ◽  
pp. 230 ◽  
Author(s):  
George Giannopoulos ◽  
Andrew Holt ◽  
Ehsan Khansalar ◽  
Patrick Mogoya
Keyword(s):  
Mergers And Acquisitions ◽  
Financial Services ◽  
Abnormal Returns ◽  
The United States ◽  
Industrial Sector ◽  
Payment Method ◽  
Public Firms ◽  
Services Sector ◽  
Long Run ◽  
The Impact

This study investigates how mergers and acquisitions (M&A) affect the wealth of shareholders of public firms in the United States (U.S). More specifically, it investigates whether the nature of the bid, the payment method used, and the type of M&A have implications for shareholders of U.S bidding firms. The study analyses 352 mergers and acquisitions in the U.S during the period 1999-2008, and its results indicate that bidding firms suffer significant negative buy-and-hold abnormal returns in the three years period after a M&A announcement. The results also suggest that, in the long-run, hostile bids and cash-financed bidders outperform friendly bids and stock-funded bidders, respectively. Furthermore, the study also finds that in the long-run bidder firms that focus on industry specialisation within their M&A targets significantly outperform firms that adopt a more diversified strategy. The analysis also investigates the effects of M&A specialisation/diversification in six different sectors, and finds that specialised bidders outperform diversified bidders in four sectors: consumer & basic materials, energy & utilities, communications and technology. Furthermore, bidder firms in the financial services sector perform significantly better when diversifying into other sectors, while the performance of bidder firms in the industrial sector appears unaffected by the degree of M&A specialisation or diversification.

scholarly journals The Impact of Single and Multiple Mergers and Acquisitions on Shareholders’ Wealth of UK Bidder Firms

2017 ◽  
Vol 9 (3) ◽  
pp. 141
Author(s):  
George Giannopoulos ◽  
Ehsan Khansalar ◽  
Patel Neel
Keyword(s):  
Mergers And Acquisitions ◽  
Target Location ◽  
Abnormal Returns ◽  
Payment Method ◽  
Short Term ◽  
Cross Border ◽  
Learning Hypothesis ◽  
The Impact ◽  
First Time ◽  
Industry Relatedness

This study investigates the impact of takeover announcements on UK acquirer shareholders’ wealth during the period 2002-2006. More specifically, it is investigated whether the impact of single acquirers on shareholders’ wealth is significantly different from the impact of multiple acquirers. Findings suggest that acquirer shareholders experience positive abnormal returns during the announcement period. Moreover, the results indicate single acquirers consistently outperform multiple acquirers when testing for deal characteristics such as: payment method (cash or equity), target status (public or private), target location (domestic or cross-border) and industry relatedness (specification or diversification). Performance declines with sequential acquisitions due to merger programme announcement hypothesis. Successful first time acquirers suffer from hubris whilst unsuccessful first time acquirers learn from their experiences suggested by the organisation learning hypothesis but go on to suffer from hubris. Acquisitions of private firms yield significant abnormal returns whereas public acquisitions reduce the value of UK acquirers. The effect of cash and equity, domestic and foreign, related and unrelated takeovers are inconclusive for the short-term windows investigated by this study.

scholarly journals Research on the Correlation between Payment Methods of M&A and M&A Performance of Listed Company

2018 ◽  
Vol 10 (6) ◽  
pp. 90
Author(s):  
Yiping Liu ◽  
Danqing Ma
Keyword(s):  
Listed Company ◽  
Listed Companies ◽  
Multiple Regression Model ◽  
Payment Method ◽  
Payment Methods ◽  
Cash Payment ◽  
Score Model ◽  
Long Term Performance ◽  
Term Performance ◽  
A Performance

As mergers and acquisitions of listed companies have become increasingly active, payment methods of M&A have also increasingly diversified. This article takes M&A cases of listed companies in china capital market as samples during 2009 to 2013. Taking financial indexes analysis and factor analysis, we can construct M&A performance comprehensive score model, by which we can calculate the score. Then, build multiple regression model to study the relation between the performance of M&A and payment methods of M&A. Studies indicate that M&A performance is stable by the cash payment method and the cash payment method has a small effect on the M&A performance; M&A performance improves obviously by the stock payment method and mixed payment is not conducive to the improvement of long-term performance; The stock payment method has a huge positive effect on the M&A performance, and the mixed payment is not beneficial to improve the M&A performance.

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