The Impact of Industry-level and Firm-level Factors on the M&A Decision and Performance﹘An Empirical Study of the Financial Consolidation in Taiwan

• Main Authors: Jen-jen Tseng, 曾真真
• Other Authors: Yung-Ching Ho
• Format: Others
• Language: zh-TW
• Published: 2005
• Online Access: http://ndltd.ncl.edu.tw/handle/68851074585610912181

博士 === 國立中正大學 === 企業管理研究所 === 93 === Market liberalization caused a dramatic increase in competition and a decreasing of profit margins in financial industry. In order to improve the fragmented market structure, most of the financial institutions attempted to go into the financial consolidation in order to pursue the scope economic and scale economic. These consolidation efforts triggered a wave of mergers within and across the financial industry. Nevertheless, whether financial consolidation is a rational change to adapt the new institutional environment or is a swarm of blind phenomenon, it is an interest issue with regard to the research and practice. At the same time, the financial consolidations were preferred to adopt the mode of M&A. Hence, this paper aimed to explore that the critical factors on the M&A decision, and construct the causal model for the financial consolidation activities. This paper explored the antecedence of M&A decision and performance based on the industry level and firm level perspective. Literature review suggested that market attractive, imitation isomorphism, resources leverage, acquire complementary resources and experience learning were the critical factors for M&A decision and performance. Therefore, we drafted both qualitative and quantitative research method desired to test the relationship of the critical factors and M&A activity. Qualitative research adopted case study technique and visited 4 cases. Quantitative research was searched about consolidation announcements for financial industry to acquire 122 samples. Furthermore, we selected the logistic regression model to construct the probability model for M&A decision. Research found the leadership’s niche market select decisions were positively related to consolidation probability. Both of the complementary combined and experience learning of the firm level factors also play critical roles in M&A decision. Moreover, we utilized event study to estimate the normal return of the M&A announcements. And choose multi-regression model construct the causal model for M&A activities. The results indicated that both industry attractive and complementary combined had a positive effect on the M&A performance. Therewith, the scope of expansion and the commitment of resources to both of the relation of firm-level factors and M&A performance were partially supported the moderating effects.