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Trends and Risks in Mergers and Acquisitions: A Review

Author

Listed:
  • Manuel García-Nieto

    (Department of Financial Economics and Accounting, Pablo de Olavide University, 41013 Seville, Spain)

  • Vicente Bueno-Rodríguez

    (Department of Financial Economics and Accounting, Pablo de Olavide University, 41013 Seville, Spain)

  • Juan Manuel Ramón-Jerónimo

    (Department of Financial Economics and Accounting, Pablo de Olavide University, 41013 Seville, Spain)

  • Raquel Flórez-López

    (Department of Financial Economics and Accounting, Pablo de Olavide University, 41013 Seville, Spain)

Abstract

This study examines risk factors in mergers and acquisitions (M&As) identified in the recent literature, addressing the following question: “What risk factors associated with M&A transactions are discussed in the recent academic literature?” A semi-systematic literature review was conducted using a comprehensive search strategy with targeted keywords related to M&A risks. Papers from 2020 to 2024 were selected based on quality and relevance, with detailed review of abstracts and titles. Co-occurrence analysis using VOSviewer software (version 1.6.20) was applied to categorize key themes. The review of 118 papers identified four main risk categories: information asymmetry; performance and corporate reputation; litigation and investor protection; and geopolitical factors. Findings reveal complex interdependencies among these risks, highlighting the need for a holistic approach to risk management. Corporate social responsibility (CSR) is crucial for mitigating risks, improving transparency, and enhancing reputation. This study offers recommendations for better financial disclosures, robust environmental, social and governance strategies, and the integration of digital finance technologies as blockchain in M&A activity. Future research should include longitudinal studies on M&A risk dynamics, case studies on corporate governance, advanced valuation methods, and comparative analyses across regions and industries, focusing on emerging technologies like AI and blockchain.

Suggested Citation

  • Manuel García-Nieto & Vicente Bueno-Rodríguez & Juan Manuel Ramón-Jerónimo & Raquel Flórez-López, 2024. "Trends and Risks in Mergers and Acquisitions: A Review," Risks, MDPI, vol. 12(9), pages 1-22, September.
    • Handle: RePEc:gam:jrisks:v:12:y:2024:i:9:p:143-:d:1474105
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    References listed on IDEAS

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    1. Brendan Daley & Thomas Geelen & Brett Green, 2024. "Due Diligence," Journal of Finance, American Finance Association, vol. 79(3), pages 2115-2161, June.
    2. Mingers, John & Yang, Liying, 2017. "Evaluating journal quality: A review of journal citation indicators and ranking in business and management," European Journal of Operational Research, Elsevier, vol. 257(1), pages 323-337.
    3. Huang, Jingong & Xie, Taojun, 2023. "Technology centrality, bilateral knowledge spillovers and mergers and acquisitions," Journal of Corporate Finance, Elsevier, vol. 79(C).
    4. Imperatore, Claudia & Pündrich, Gabriel & Verdi, Rodrigo S. & Yost, Benjamin P., 2024. "Litigation risk and strategic M&A valuations," Journal of Accounting and Economics, Elsevier, vol. 78(1).
    5. Ranaldo, Angelo & Somogyi, Fabricius, 2021. "Asymmetric information risk in FX markets," Journal of Financial Economics, Elsevier, vol. 140(2), pages 391-411.
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