IDEAS home Printed from https://ideas.repec.org/a/aoj/ajeaer/v3y2016i2p130-138id220.html
   My bibliography  Save this article

Performance Evaluation of UK Acquiring Companies in the Pre and Post-Acquisitions Periods

Author

Listed:
  • Khurshid Ali
  • Zeeshan Khan
  • Numan Khan
  • Abdul-Hamid Ibrahim Alsubaie
  • Fazal Subhan
  • Moumen Kanadil

Abstract

This paper has two objectives: first, it examines the financial performance of twenty UK based acquiring companies over the period of five years (2009-2013) using financial ratios of Liquidity, Profitability and Solvency in order to empirically determine whether there is any significant financial performance changes in the operation of the underlying companies as a result of acquisitions. Both average ratio and paired t-test analysis have been conducted. The analysis concludes that none of the ratios proved statistical significance which shows that the underlying acquisitions did not influence changes in the financial performance of the acquiring companies. The paper also examines whether shareholders make short-term gain while opting for acquisitions by analyzing stocks return over 58 days window period i.e. 29 days prior to acquisition announcement and 29 days after acquisition announcement by applying CAPM model and AAR and CAAR analysis. The analysis concludes that none of the results show statistical significance which further asserts that UK shareholders do not make gain in the short-term as a result of the acquisition activities they have undertaken.

Suggested Citation

  • Khurshid Ali & Zeeshan Khan & Numan Khan & Abdul-Hamid Ibrahim Alsubaie & Fazal Subhan & Moumen Kanadil, 2016. "Performance Evaluation of UK Acquiring Companies in the Pre and Post-Acquisitions Periods," Asian Journal of Economics and Empirical Research, Asian Online Journal Publishing Group, vol. 3(2), pages 130-138.
    • Handle: RePEc:aoj:ajeaer:v:3:y:2016:i:2:p:130-138:id:220
    as

    Download full text from publisher

    File URL: http://asianonlinejournals.com/index.php/AJEER/article/view/220/197
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xu, Ting & Hordofa, Tolassa Temesgen & Kaur, Prabjot & Dongsheng, Chen & Muda, Iskandar, 2024. "Natural resources management efficiency: The role of green innovation for digital government," Resources Policy, Elsevier, vol. 95(C).
    2. Sharifah Nazatul Faiza Syed Mustapha Nazri & Mohd Ikram Abdul Rasib & Salwa Zolkifli, 2019. "The Influence of Competency, Usage of It and Career Expectation on Internal Auditor¡¯s Effectiveness in Ggovernment Linked Companies (GLCs)," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 10(3), pages 337-352, May.
    3. Xie, Peijun & Xiao, Wenhui & Cai, Yifan & Zhu, Zili, 2024. "Does decentralization improve natural resources and government efficiency?," Resources Policy, Elsevier, vol. 91(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aoj:ajeaer:v:3:y:2016:i:2:p:130-138:id:220. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sara Lim (email available below). General contact details of provider: http://asianonlinejournals.com/index.php/AJEER/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.