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Title: An analysis of acquirers' returns of cross-border mergers and acquisitions by Chinese firms
Author: Du, Min
ISNI:       0000 0004 5359 4420
Awarding Body: University of Nottingham
Current Institution: University of Nottingham
Date of Award: 2014
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The main aim of this research is to investigate three key dimensions of cross-border mergers and acquisitions (CBM&As) by Chinese acquiring firms: trends, patterns, and distributions, the short-term and long-term value creation and the institutional and firm level factors affecting the value creation of Chinese CBM&As. These dimensions are explored using a multi-method approach involving, standard Event Study methodology (Market Model); Buy and Hold Abnormal Returns (BHARs), Calendar Time Abnormal Returns (CT ARs), multivariate regression analyses and test of differences. Both aggregate and firm level data were collected from a number of secondary sources, namely Chinese Stock Market and Accounting Research Database (CSMAR), the World Investment Report produced by UNCTAD, Thomson's SDC Platinum M&A Database and China Statistical Year Book. First, the trends and patterns of Chinese CBM&As are examined. The results indicate that GDP, money supply, interest rates, inflation, acquisitions in resource seeking sectors and cultural distance play an important role in explaining the trends of CBM&As outflows by the Chinese firms. The findings support the notion that home country macroeconomic and institutional factors can create advantages to improve the outward CBM&As activities, particularly, by emerging economy firms. Second, this study examines the short-term value creation of Chinese CBM&As and the impact of state ownership and institutional factors on the value creation. We find evidence of positive abnormal returns for Chinese acquirers in the short-term. Moreover, value creation by Chinese acquiring firms is influenced by formal institutional distance, reforms in exchange rate approval systems and state ownership, indicating that and Chinese government and institutions have significant influence on CBM&As short-term value creation. Third, this research investigates the long-term value creation of CBM&As by Chinese acquirers and the factor affecting the long-term value creation. We find significant negative long-term abnormal returns after the acquisitions. Our cross-sectional regression results show that state ownership, formal institutional distance, priority sector, interaction between priority sector and SOEs, cash holding and acquirer size exert significantly impact on the post-event long term returns.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available