Publication detail

Assessment of the Performance of Mergers: Revisiting Results after a Prolonged Period

PĚTA, J. REŽŇÁKOVÁ, M.

Original Title

Assessment of the Performance of Mergers: Revisiting Results after a Prolonged Period

Type

conference paper

Language

English

Original Abstract

Research background: Mergers and acquisitions (M&As) have become a widespread tool for business growth strategy. Considering the developments after the previous financial crisis, a fresh wave of M&As is expected to appear in the near future. Investors will look for suitable businesses to consolidate their market position. Purpose of the article: The aim of this work is to assess the performance of completed mergers over a period of five years and compare the results with previous research in which we examined the success of mergers over a threeyear period. Our goal was to find out if any differences in performance indicators occur and if these differences are significant. The results may offer potential indicators of merger success rate prediction. Methods: We focused our research on mergers of private companies (i.e. not publicly traded companies) in the Czech Republic. Our research sample contained 50 completed mergers. The mergers were divided into two groups – successful and unsuccessful – according to the sales and profit of the merged company. We calculated financial indicators for each group based on accounting data. We then used the Mann-Whitney U test to test the significance of the differences between the indicator values. Findings & value added: Several important performance indicators emerged. The most significant included production consumption to sales, the material cost to sales, receivables to sales, assets turnover and profitability ratios. The ratio labour cost to sales was replaced with the ratio value added to labour cost. Our research concludes that these indicators can be considered crucial.

Keywords

merger and acquisition; predictors; effectiveness; Czech Republic

Authors

PĚTA, J.; REŽŇÁKOVÁ, M.

Released

13. 1. 2021

Publisher

EDP Sciences

Location

Žilina

ISBN

2261-2424

Periodical

SHS Web of Conferences

Year of study

92

State

French Republic

Pages from

1

Pages to

10

Pages count

10

URL

https://www.shs-conferences.org/articles/shsconf/abs/2021/03/shsconf_glob20_07048/shsconf_glob20_07047.html

Full text in the Digital Library

http://hdl.handle.net/11012/196370

BibTex

@inproceedings{BUT169129,
  author="Jan {Pěta} and Mária {Režňáková}",
  title="Assessment of the Performance of Mergers: Revisiting Results after a Prolonged Period",
  booktitle="The 20th International Scientific Conference Globalization and its Socio-Economic Consequences 2020",
  year="2021",
  journal="SHS Web of Conferences",
  volume="92",
  number="92",
  pages="1--10",
  publisher="EDP Sciences",
  address="Žilina",
  doi="10.1051/shsconf/20219207047",
  issn="2261-2424",
  url="https://www.shs-conferences.org/articles/shsconf/abs/2021/03/shsconf_glob20_07048/shsconf_glob20_07047.html"
}