Cross-border mergers and acquisitions and default risk
| aut.researcher | Koerniadi, Hardjo | |
| dc.contributor.author | Koerniadi, H | en_NZ |
| dc.contributor.author | Krishnamurti, C | en_NZ |
| dc.contributor.author | Tourani-Rad, A | en_NZ |
| dc.date.accessioned | 2016-06-01T04:58:06Z | |
| dc.date.available | 2016-06-01T04:58:06Z | |
| dc.date.copyright | 2015-09-03 | en_NZ |
| dc.date.issued | 2015-09-03 | en_NZ |
| dc.description.abstract | We examine the impact of cross-border mergers on acquirers' post-merger default risk using a sample of 375 US acquiring firms from 1997 to 2011. After controlling for cultural, institutional, geographic and managerial factors between the US and target firm countries, we find that on average, cross-border transactions decrease the level of default risk of the acquiring firms. Our results are consistent with the asymmetric information hypothesis that managers take advantage of the overvaluation and volatility of their stock prices. We also observe that the geographic distance and industrial relatedness play significant roles in affecting post-merger default risk but find limited evidence indicating the relevance of institutional environments and cultural factors on changes in default risk. Managers use cross-border mergers to manage the extant risk of their firms. However, their incentives to use cross-border mergers to manage risk are mitigated by option compensation. | |
| dc.identifier.citation | International Review of Financial Analysis, Volume 42, December 2015, Pages 336–348 | en_NZ |
| dc.identifier.doi | 10.1016/j.irfa.2015.08.009 | en_NZ |
| dc.identifier.issn | 1057-5219 | en_NZ |
| dc.identifier.uri | https://hdl.handle.net/10292/9849 | |
| dc.publisher | Elsevier | |
| dc.relation.uri | http://dx.doi.org/10.1016/j.irfa.2015.08.009 | |
| dc.rights | Copyright © 2015 Elsevier Ltd. All rights reserved. This is the author’s version of a work that was accepted for publication in (see Citation). Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. The definitive version was published in (see Citation). The original publication is available at (see Publisher's Version). | |
| dc.rights.accessrights | OpenAccess | en_NZ |
| dc.subject | Cross-border mergers; Default risk; Idiosyncratic risk | |
| dc.title | Cross-border mergers and acquisitions and default risk | en_NZ |
| dc.type | Journal Article | |
| pubs.elements-id | 192815 | |
| pubs.organisational-data | /AUT | |
| pubs.organisational-data | /AUT/Business & Law | |
| pubs.organisational-data | /AUT/Business & Law/Finance | |
| pubs.organisational-data | /AUT/Business & Law/Finance/Finance PBRF 2012 |