Academy of Strategic Management Journal (Print ISSN: 1544-1458; Online ISSN: 1939-6104)


Determinants of Merger and Acquisition Strategies Success in Emerging Markets: Evidence from EGX

Author(s): Osama Wagdi, Eman Salman

 The current study investigated the determinants of merger and acquisition strategies' success in emerging markets, based on an analysis of the Egyptian market. According to listed corporations at EGX that carried out mergers and acquisitions during the study period from 1999 to 2015, based on Heteroskedasticity-corrected test for twenty cases. The study presents a contribution through four dimensions: Analyzing the impact of distinguishing between successful and unsuccessful acquisitions and mergers, distinguishing between extraordinary returns that can be traced back to the completion of acquisitions and mergers and ordinary returns that are related to the economic situation, discerning the financing returns under acquisitions and mergers. Addition to determining the effect of the pattern of integration between acquisition and merger parties on the returns of that integration. Finally, in Egypt, the compound annual growth rate of revenue is the most important factor in the determinants of merger and acquisition (M&As) strategies' success, where CAGR of revenue explains the improvement in two indicators of merger and acquisition (M&As) success. A decrease in costs, and an improvement in the stability of cash flows. But CAGR of revenue is not the only determinant of merger and acquisition (M&As) strategies' success in Egypt. The improvement in net profits is back to the compound annual growth rate of net profit", "financial leverage ratio,", and "corporate size" under merger and acquisition (M&As) strategies. From that, the study can be said that the growth strategy is the basis of merger and acquisition (M&As) success in Egypt.

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