Evidence of Fire-Sale M&A in European Transition Countries
AbstractThe aim of this paper is to determine differences in variables that create investment climate and therefore affect the values of incoming crossborder M&A in selected European transition countries. Cluster analysis for 1999 and 2007 shows that countries with unfavourable investment climate received high levels of incoming cross-border M&A. Sole country in the cluster characterised by healthy investment area (Slovenia) had the highest GDP per capita accompanied with the lowest values of incoming cross-border M&A relative to its GDP. These results could be interpreted as an evidence of fire-sale M&A in most European transition countries. In 2010, situation changed and although recession left trace, data on cross-border M&A indicate that foreign investors focused more on companies which operated in countries with healthier economy. These results indicate that a healthy investment climate is necessary to provide a sustainable economic development of a country.
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Bibliographic InfoArticle provided by University of Primorska, Faculty of Management Koper in its journal Managing Global Transitions.
Volume (Year): 10 (2012)
Issue (Month): 4 (Winter) ()
Find related papers by JEL classification:
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Miriam Manchin, 2004. "Determinants of European cross-border mergers and acquisitions," European Economy - Economic Papers 212, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
- repec:ebl:ecbull:v:7:y:2008:i:8:p:1-12 is not listed on IDEAS
- Gunther Tichy, 2001. "What Do We Know about Success and Failure of Mergers?—Rejoinder," Journal of Industry, Competition and Trade, Springer, vol. 1(4), pages 431-440, December.
- Deng, Ping, 2009. "Why do Chinese firms tend to acquire strategic assets in international expansion?," Journal of World Business, Elsevier, vol. 44(1), pages 74-84, January.
- Ang, James & Mauck, Nathan, 2011. "Fire sale acquisitions: Myth vs. reality," Journal of Banking & Finance, Elsevier, vol. 35(3), pages 532-543, March.
- Gunther Tichy, 2001. "What Do We Know about Success and Failure of Mergers?," Journal of Industry, Competition and Trade, Springer, vol. 1(4), pages 347-394, December.
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