Does merger & acquisition (M&A) strategy matter? A contingency perspective. Issue 6 (December 2022)

• Record Type: Journal Article
• Authors: Angwin, Duncan N.; Urs, Uma; Appadu, Naaguesh; Thanos, Ioannis C.; Vourloumis, Stavros; Kastanakis, Minas N.
• Is Part Of: European management journal. Volume 40:Issue 6(2022)
• Page Start: 847
• Page End: 856
• Publication Date: 2022-12
• Subjects: M&As -- M&A strategy -- Contingency perspective -- Acquiring firm level strategy -- CEO motivation -- Typology; Management -- Periodicals; Management -- Europe -- Periodicals; Gestion -- Périodiques; Gestion -- Europe -- Périodiques; Management; Europe; Periodicals; Electronic journals; 658.0094
• DOI: 10.1016/j.emj.2022.09.004
• Languages: English
• ISSNs: 0263-2373

Abstract

Abstract: This paper takes a contingency approach to investigate whether there are market performance variations for different types of M&A. Eight different types of M&A are identified in a typology based upon the conjunction of three contextual dimensions: external environmental, acquiring firm level strategy and CEO motivation. Drawing upon a sample of 1, 926 domestic UK deals we evaluate the typology to determine whether the financial markets distinguish between different types of M&A. Results indicate significant market and risk-adjusted performance differences by M&A type. These confirm that a contingency approach to M&A performance has merit. We suggest that the proposed integrated typology, that recognizes the importance of multiple aspects of strategic fit to M&A performance, addresses the paradox that M&A practitioners continue to pursue deals despite widespread acceptance that they result in high failure rates.