What Affect Premiums in the Payment of Mergers and Acquisitions?

• Main Authors: Pin-FongWang, 王品丰
• Other Authors: Chiung-Hui Tseng
• Format: Others
• Language: en_US
• Published: 2017
• Online Access: http://ndltd.ncl.edu.tw/handle/5d3q7j

碩士 === 國立成功大學 === 國際企業研究所 === 105 === The practice of M＆As play an important role in the real business world and it is common to see companies pay premium payments in order to acquire desired target firms. Previous researchers tried to find out why companies paid premium payments in M＆As and what is an appropriate amount of premium. Previous studies tended to focus on analyzing acquirers or target firms separately and seldom take both characters into consideration simultaneously. This study aims to investigate what factors would cause higher premium payments in M＆As, and suggests that both acquirers and target firms would affect results of premium payments. Three main effects from acquirers were taken into consideration, including acquirer’s performance, the duration between announcement and effective date, and acquirer’s M＆A experiences. Industrial relatedness and target firm value acted as moderators. Hypotheses were tested using secondary data of 117 M＆A events in global retail and wholesale industries from SDC and WRDS database. Models were tested by linear regression. We proposed that three main factors from acquirers would cause higher premiums and two distinctive moderators would positively affect main effects, which makes premiums even higher. Results show that acquirers’ performance and M＆A experiences lead to higher premium payments while the duration between announcement and effective date shows no significant relationship with premium payments. Also, industrial relatedness indeed strengthens the relationship between acquirers’ performances and premium payments and the relationship between M＆A experiences and premium payment, while target firms’ value shows a positive moderating effect on acquirer’s performances and duration. According to the results, the influences from acquirers and target firms are both significant to the results of high premium payments in M＆As.