This study analyses the abnormal returns generated by developed market acquirers, from 22 different countries, in M&A transactions for emerging target firms, with focus on the determinants causing these abnormal returns. The sample entails 1412 M&As involving target firms from 26 different countries in the time period of 1995 to 2018. At the day of the announcement and the day afterwards, abnormal returns for developed market acquirers accumulate to a statistical significant 0.75%. Nonetheless, acquirers destroy the initial shareholder value generated within the two-day event window, measured by a three months window after the announcement, indicating a significant value destruction of -1.8%. Explanatory for the initial anomalous returns generated for shareholders to acquiring firms are the percentage of shares acquired, transaction value of the deal and acquirer size. These determinants being significant, despite measures of robustness and controlling for target industry and regional effects. Further, the paper complements these determinants by finding a positive effect of information asymmetry and heterogeneity, between acquirer and target country, on acquirer’s stock performance, nonetheless, this being limited to economic and institutional differences.

Additional Metadata
Keywords Mergers and Acquisitions, M&As, developed market acquirers, emerging market target, acquirer’s shareholder value creation, acquirer’s (cumulative) abnormal returns.
Thesis Advisor Bliek, R. de
Persistent URL
Series Business Economics
Lieb, F.C. (2019, August 7). Shareholder Value Creation in Mergers and Acquisitions into Emerging Markets: Determinants of Acquirer’s Performance. Business Economics. Retrieved from