Market response to internationalization strategies: Evidence from Indian cross-border acquisitions. Issue 2 (June 2015)

• Record Type: Journal Article
• Authors: Rani, Neelam; Yadav, Surendra S.; Jain, P.K.
• Is Part Of: IIMB management review. Volume 27:Issue 2(2015:Jun.)
• Page Start: 80
• Page End: 91
• Publication Date: 2015-06
• Subjects: Event study -- Stock market valuation -- Cross-border mergers and acquisitions -- India -- Shareholder value -- Emerging market -- Developed market; Management -- Periodicals; Industrial management -- Periodicals; Industrial management; Management; India; Periodicals; 658
• DOI: 10.1016/j.iimb.2015.03.002
• Languages: English
• ISSNs: 0970-3896

Abstract

Abstract: The paper provides evidence that shareholders of acquirer Indian corporations engaging in cross-border transactions experience a statistically significant positive average abnormal return on the announcement day as well as cumulative average abnormal returns over multi-day event windows. The gains are significantly positive and higher for the acquisitions of targets in developed markets. The regression analysis in the paper highlights that cross-border acquisitions of high tech sector target firms in developed markets generate better wealth. Further, relatively larger acquisitions create higher gains.