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Drivers of Merger and Acquisition Activities in Vietnam: Insights from Targets’ Perspectives and Deal Characteristics

Author

Listed:
  • Khoa Bui

    (State Bank of Vietnam, Ha Noi 10000, Vietnam)

  • Tu Le

    (Faculty of Banking & Finance, University of Economics and Law, Ho Chi Minh City 70000, Vietnam
    Vietnam National University, Ho Chi Minh City 70000, Vietnam)

  • Thanh Ngo

    (School of Aviation, Massey University, Palmerston North 4410, New Zealand
    Faculty of Political Economy, VNU University of Economics and Business, Hanoi 10000, Vietnam)

Abstract

This study empirically examines the determinants of merger and acquisition (M&A) activities in Vietnam from 2005 to 2020, which has not been examined before, using a fixed-effects model for a sample of 674 completed M&A deals. The results indicate that targets’ corporate governance and deal characteristics have mixed effects on M&A decisions. More specifically, the independent member of the board and CEO duality of the target is negatively associated with most M&A types, except for cross-border mergers. However, the impact of targets’ blockholders is consistently positive regardless of M&A types. When observing the deal characteristics, mixed evidence is also found in the case of M&A payment form, industry-relatedness between the bidder and the target, the bidder’s stake in the target, and foreign ownership in the bidder’s stake. More interesting, our study emphasizes that voluntary agreement is seemingly critical to M&A decisions regardless of different types. Our results suggest several important implications, including balancing independent directors on the board, accounting for CEOs’ and other blockholders’ interests and influence, considering the types of M&A payments, and involving foreign investors in M&A activities. By understanding these implications, firms can better navigate the complexities of M&A transactions, enhancing their decision-making processes and ultimately contributing to improved shareholder value.

Suggested Citation

  • Khoa Bui & Tu Le & Thanh Ngo, 2025. "Drivers of Merger and Acquisition Activities in Vietnam: Insights from Targets’ Perspectives and Deal Characteristics," IJFS, MDPI, vol. 13(1), pages 1-20, February.
    • Handle: RePEc:gam:jijfss:v:13:y:2025:i:1:p:19-:d:1582615
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    References listed on IDEAS

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