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Merger waves, entry-timing, and cross-border acquisition completion: A frictional lens perspective

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  • Fuad, Mohammad
  • Gaur, Ajai S.

Abstract

We study the impact of deal announcement and entry-timing within a cross-border acquisition (CBA) wave on the likelihood of acquisition completion. Drawing upon the frictional lens perspective, we identify two types of frictional forces- wave-friction and partner-friction within merger waves. We follow a simulation-based methodology and identify three CBA waves for Indian acquirers between 1995 and 2015. Our findings suggest that acquisition announcement within a merger wave as compared to outside of a wave is negatively related to the likelihood of deal completion. Further, within a merger wave, we find an inverted U-shaped relationship between entry-timing and the likelihood of deal completion.

Suggested Citation

  • Fuad, Mohammad & Gaur, Ajai S., 2019. "Merger waves, entry-timing, and cross-border acquisition completion: A frictional lens perspective," Journal of World Business, Elsevier, vol. 54(2), pages 107-118.
    • Handle: RePEc:eee:worbus:v:54:y:2019:i:2:p:107-118
    DOI: 10.1016/j.jwb.2018.12.001
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