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Differences in returns to cross-border and domestic mergers and acquisitions: Empirical evidence from China using PSM-DID

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  • Yuan, Chen
  • Jiang, Hanming
  • Chen, Chen

Abstract

Domestic mergers and acquisitions (M&As) are more common in China than overseas. To determine the underlying causes, we examine the different impacts of cross-border and domestic M&As on the performance of Chinese listed firms using PSM-DID on a sample of 1616 deals of M&As. We established that domestic M&As can earn more market value than cross-border M&As. Additionally, we established that no more value added is created by SOEs through M&As. These findings emphasize the important role of domestic production networks in China and suggest that the Chinese government should consider the promotion and optimization of domestic industrial integration.

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  • Yuan, Chen & Jiang, Hanming & Chen, Chen, 2023. "Differences in returns to cross-border and domestic mergers and acquisitions: Empirical evidence from China using PSM-DID," Finance Research Letters, Elsevier, vol. 55(PB).
    • Handle: RePEc:eee:finlet:v:55:y:2023:i:pb:s1544612323003331
    DOI: 10.1016/j.frl.2023.103961
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