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Decision-making from a risk assessment perspective for Corporate Mergers and Acquisitions

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  • Jinwook Lee
  • András Prékopa

Abstract

Corporate Mergers and Acquisitions (M $$ { \& }$$ & As) are notoriously complex, and risk management is one of the essential aspects of the analysis process for decision-making on M $$ { \& }$$ & A deals. Empirically, we see that some M $$ { \& }$$ & A transactions are not successful in part because of the increased exposure to correlated sectors, suggesting that the merged entity possesses increased risk in the market. This motivates our research on risk evaluation processes for corporate M $$ { \& }$$ & A deals. In this paper, a decision making scheme using a reasonable risk measure is introduced and surveyed. Numerical examples are presented. Copyright Springer-Verlag Berlin Heidelberg 2015

Suggested Citation

  • Jinwook Lee & András Prékopa, 2015. "Decision-making from a risk assessment perspective for Corporate Mergers and Acquisitions," Computational Management Science, Springer, vol. 12(2), pages 243-266, April.
    • Handle: RePEc:spr:comgts:v:12:y:2015:i:2:p:243-266
    DOI: 10.1007/s10287-014-0221-y
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