סמינר במימון חשבונאות

 Hervé Stolowy  (HEC Paris)

 Abstract:

We investigate whether the relation between expected synergies and post-acquisition performance differs between cross-border M&As and domestic M&As. Managers may, on average, fail to accurately estimate synergies resulting from cross-border M&As because of geographical, cultural, and institutional factors, or because of the greater difficulty to forecast integration costs ex post. Alternatively, managers may engage in cross-border deals only if they perceive that they can accurately estimate synergies. We use goodwill resulting from the transaction to measure expected synergies. Using a sample of M&As completed by US acquirers, we show that, relative to domestic goodwill, cross-border goodwill is positively

associated with increasing post-acquisition operating performance, sales growth, stock returns, and Tobin’s q. In addition, we find that cross-border acquirers are less likely to impair goodwill in the year following the acquisition. We also document that, among cross-border acquirers, firms that complete acquisitions in more culturally and institutionally distant countries relative to the US, exhibit a lower association between expected synergies and change in operating performance and are more likely to impair goodwill. Our findings suggest that managers forecast accuracy follows an “inverted U curve” function of the institutional and cultural distance relative to the US.