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Investors' decisions following acquisition announcements: A configurational analysis of the role of acquirers' resources, capabilities, and strategic fit with the target firm

Author

Listed:
  • Ana Colovic

    (NEOMA - Neoma Business School)

  • Olivier Lamotte

    (Métis Lab EM Normandie - EM Normandie - École de Management de Normandie)

  • Jiachen Yang

    (NEOMA - Neoma Business School)

Abstract

This research investigates how different configurations of acquirers' resources, capabilities, and strategic fit with the target firm influence investors' decisions following acquisition announcements. Drawing on signalling theory and the resource-based view, we argue that investors closely scrutinize acquirers' bundles of resources to evaluate holistically the future outcome of the deal. Our fuzzy-set Qualitative Comparative Analysis (fsQCA) confirms that investors' decisions leading to abnormal stock returns following acquisition announcements depend on the configuration of the acquirer's resources, capabilities, and strategic fit with the target. It also reveals different configurations that lead to high or low short-term stock market performance. Based on the findings, we propose five strategic profiles of merger and acquisition (M&A) deals.

Suggested Citation

  • Ana Colovic & Olivier Lamotte & Jiachen Yang, 2021. "Investors' decisions following acquisition announcements: A configurational analysis of the role of acquirers' resources, capabilities, and strategic fit with the target firm," Post-Print hal-03338555, HAL.
    • Handle: RePEc:hal:journl:hal-03338555
    DOI: 10.1111/emre.12481
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    Cited by:

    1. Phan Huy Hieu Tran & Thu Ha Tran & Ji‐yong Lee, 2023. "How employee share ownership plans impact firms’ market value: A conflict of interest theory approach," Post-Print hal-04678289, HAL.

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