•  
  •  
 

Abstract

The objective of this study is to examine the effects of mergers and acquisitions (M&A) motivations on the financial performance of companies operating in Indonesia during the period from 2010 to 2019. The primary objective of this study was to examine the variations in business performance in relation to the three distinct reasons for mergers and acquisitions. There are three primary incentives identified in the literature, including value-chain extension, technology seeking, and other motiva-tions. The sample comprises 72 firms that are listed on the Indonesia Stock Exchange. During the des-ignated research period, a total of 137 merger and acquisition (M&A) transactions were observed. The present study employed a feasible generalized least squares (FGLS) approach. The present study has identified a positive correlation between other mergers and acquisitions and firms' performance in Indonesia, with regards to three distinct types Penelitian ini bertujuan untuk menganalisis bagaimana jenis motivasi kegiatan merger dan/atau akuisisi (M&A) perusahaan mempengaruhi performa keuangan perusahaan pada perusahaan di In-donesia pada tahun 2010 hingga 2019. Fokus pada penelitian ini juga untuk memahami dan men-guji bagaimana perbedaan pengaruh dari tiga tipe motivasi perusahaan dalam melakukan M&A terhadap performa perusahaan. Ketiga motivasi tersebut diantaranya adalah perluasan rantai ni-lai (value-chain-extension), technology-seeking dan campuran. Penelitian ini menggunakan sampel yang terdiri dari 72 perusahaan yang tercatat pada Bursa Efek Indonesia. Selama periode penelitian, terdapat 137 kegiatan M&A. Metode penelitian yang digunakan adalah metode feasible general-ized least square. Penelitian ini menemukan bahwa dari tiga motivasi perusahaan melakukan M&A, hanya kegiatan M&A tipe campuran yang memiliki pengaruh positif signifikan terhadap performa perusahaan.of M&A motivation.

References

Anthony, M. U. G. O. (2019). Effects of merger and acquisition on financial performance: case study of commercial banks. International Journal of Business Management and Finance, 1(1).

Aybar, B., Ficici, A., 2009. Cross-border acquisitions and firm value: an analysis of emerging-market multinationals. J. Int. Bus. Stud. 40 (8), 1317–1338.

Baghat, S., Black, B., 2000. Board independence and long-term firm performance. Columbia Law School. In: Law and Economics Working Paper.

Bertrand, O., Betschinger, M.A., 2012. Performance of domestic and cross-border acquisitions: em- pirical evidence from Russian acquirers. J. Comp. Econ. 40, 413–437.

Bhagat, S., Malhotra, S., Zhu, P.C., 2011. Emerging country cross-border acquisitions: characteris- tics, acquirer returns and cross-sectional determinants. Emerg. Mark. Rev. 12, 250–271.

Brooks, C. (2019). Introductory econometrics for finance. Cambridge university press.

Chari, A., Chen, W., Dominguez, K.M.E., 2012. Foreign ownership and firm performance: emerging market acquisitions in the United States. IMF Econ. Rev. 60 (1), 1–42.

Chu, Y., Chu, J., & Liu, H. (2020). The impact of mergers and acquisitions on brand equity:A struc- tural analysis. International Journal of Research in Marketing.

Chu, Y. (2017). Shareholder litigation, shareholder–creditor conflict, and the cost of bank loans. Jour- nal of Corporate Finance, 45, 318–332.

Conyon, M. J., Girma, S., Thompson, S., & Wright, P. W. (2002). The impact of mergers and acquisi- tions on company employment in the United Kingdom. European Economic Review, 46(1), 31-49.

Cooper, C. L., & Finkelstein, S. (Eds.). (2009). Advances in mergers and acquisitions. Emerald Group Publishing Limited. Cording, M., Christmann, P., Bourgeois Iii, L.J., 2002. A focus on resources in M&A success: a litera- ture review and research agenda to resolve two paradoxes. Acad. Manag. 12 (8), 1–40.

Fama, E. F. (1980). Agency problems and the theory of the firm. Journal of political economy, 8(2), 288-307.

Ghillyer, A. (2012). Business ethics now. McGraw-Hill. Goddard, J., Molyneux, P., Zhou, T., 2012. Bank mergers and acquisitions in emerging markets: evi- dence from Asia and Latin America. Eur. J. Finan. 18 (5), 419–438.

Gorton, G., Kahl, M., & Rosen, R. J. (2009). Eat or be eaten: A theory of mergers and firm size. Jour- nal of Finance, 64(3), 1291–1344.

Gubbi, S.R., Aulakh, P.S., Ray, S., Sarkar, M.B., Chittoor, R., 2010. Do international acquisitions by emerging-economy firms create shareholder value? The case of Indian firms. J. Int. Bus. Stud. 41 (3), 397–418.

Gujarati, D.N. and Porter, D.C. (2014), Basic Econometrics, 5th ed., Mc-Graw Hill Publishing, New York, NY.

Hansen, R. G. (1987). A theory for the choice of exchange medium in mergers and acquisitions. Jour- nal of business, 75-95.

Harford, J. (2005). What drives merger waves?. Journal of financial economics, 77(3), 529560.

Hu, M., Mou, J., & Tuilautala, M. (2020). How trade credit affects mergers and acquisitions. International Review of Economics & Finance, 67, 1-12.

Hossain, M.S., 2020, Merger & Acquisitions (M&As) as an Important Strategic Vehicle in Business:Thematic Areas, Research Avenues & Possible Suggestions, Journal of Economics and Business,106004, 0148-6195.

Jensen, M.C., 1986. Agency costs of free cash flow, corporate finance, and takeovers. Am. Econ. Rev.76 (2), 323–329.

Jiang, F.X., Zhang, M., Liu, Z.B., 2008. Mergers and acquisitions or self investment: a study on the choice of expansion modes of Chinese listed companies. J. World Econ. 8, 77–84.

Koi-Akrofi, G. Y. (2016). Mergers and acquisitions failure rates and perspectives on why they fail. International Journal of Innovation and Applied Studies, 17(1), 150.

Larsson, R., & Finkelstein, S. (1999). Integrating strategic, organizational, and human resource perspectives on mergers and acquisitions: A case survey of synergy realization. Organization science,10(1), 1-26.

Li, M., Wong, Y.Y., 2003. Diversification and economic performance: an empirical assessment of Chinese firms. Asia Pac. J. Manag. 20 (2), 243–265.

Liu, X.P., Huang, X.W., Guo, H.Y., 2009. An empirical study on industry cycle, mergers and acquisitions type and mergers and acquisitions performance. J. Financ. Res. 3, 135–153.

Makri, M., Hitt, M. A., & Lane, P. J. (2010). Complementary technologies, knowledge relatedness,and invention outcomes in high technology mergers and acquisitions. Strategic management journal,31(6), 602-628.

McKinsey. (2021). How one approach to M&A is more likely to create value than all others. Retrieved from https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/ourinsights/how-one-approach-to-m-and-a-is-more-likely-to-create-value-than-allothers#/Mergermarket, 2015 Regional MA Comparison.

Meyer, K.E., Thaijongrak, O., 2013. The dynamics of emerging economy MNEs: how the internationalization process model can guide future research. Asia Pac. J. Manag. 30 (4), 1125–1153.

Meyer, K.E., Estrin, S., Bhaumik, S., Peng, M.W., 2009. Institutions, resources, & entry strategies inemerging economies. Strateg. Manag. J. 30 (1), 61–80.

Ruhl, T. A., & Lopez, Y. P. (2023). Support and Adaptability: Applications for Post-Merger IntegrationWithin Professional Service Firms. Organization Development Journal, 41(1).

Mitchell, M. L., & Mulherin, J. H. (1996). The impact of industry shocks on takeover and restructuring activity. Journal of financial economics, 41(2), 193-229.

Sahu, S. K., & Agarwal, N. (2017). Inter-firm differences in mergers and acquisitions: a study of the pharmaceutical sector in India. Journal of Economic Studies.

Schweiger, D. M., Csiszar, E. N., & Napier, N. K. (1994). A strategic approach to implementing mergers and acquisitions. The management of corporate acquisitions: International perspectives,23-49.

Sherman, A. J. (2016). The Basics of Mergers and Acquisitions. Mergers and Acquisitions from A to Z, 12.

Statista. (2023). Number of mergers and acquisitions (M&A) deals in Indonesia from 2013 to 2021.Retrieved from https://www.statista.com/statistics/1023459/indonesia-mergers-and-acquisitions dealvolume/#:~:text=Number%20of%20M%26A%20deals%20in%20Indonesia%202013%2D2021&text=In%202021%2C%20the%20total%20number,62%20deals%20recor ded%20in%202020.

PwC Indonesia. (2022). Navigating Post-Pandemic Opportunities: Indonesian M&A Outlook & Insights. Retrieved from https://www.pwc.com/id/en/media-centre/press-release/2022/english/navigating-postpandemic-opportunities-indonesian-m-a-outlook-insights.html

Wei, C.L., Zheng, J., 2009. The relationship between China's independent director system and corporate performance: an analysis based on data from 2003 to 2008 of listed companies in Chinese pharmaceutical manufacturing industry. Econ. Manag. J. 9, 49–54.

Zhang, W., Wang, K., Li, L., Chen, Y. and Wang, X., 2018. The impact of firms' mergers and acquisitions on their performance in emerging economies. Technological Forecasting and Social Change, 135, pp.208-216.

Bahasa Abstract

Penelitian ini bertujuan untuk menganalisis bagaimana jenis motivasi kegiatan merger dan/atau akuisisi (M&A) perusahaan mempengaruhi performa keuangan perusahaan pada perusahaan di In-donesia pada tahun 2010 hingga 2019. Fokus pada penelitian ini juga untuk memahami dan men-guji bagaimana perbedaan pengaruh dari tiga tipe motivasi perusahaan dalam melakukan M&A terhadap performa perusahaan. Ketiga motivasi tersebut diantaranya adalah perluasan rantai ni-lai (value-chain-extension), technology-seeking dan campuran. Penelitian ini menggunakan sampel yang terdiri dari 72 perusahaan yang tercatat pada Bursa Efek Indonesia. Selama periode penelitian, terdapat 137 kegiatan M&A. Metode penelitian yang digunakan adalah metode feasible general-ized least square. Penelitian ini menemukan bahwa dari tiga motivasi perusahaan melakukan M&A, hanya kegiatan M&A tipe campuran yang memiliki pengaruh positif signifikan terhadap performa perusahaan.

Download

Share

COinS