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Investor sentiment and M&A withdrawal: International evidence

Author

Listed:
  • Fabrice Hervé

    (CREGO - Centre de Recherche en Gestion des Organisations - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UB - Université de Bourgogne - UBFC - Université Bourgogne Franche-Comté [COMUE] - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE], UB - Université de Bourgogne)

  • Ibtissem Rouine

    (IDRAC Business school Lyon - Institut pour le Développement et la Recherche d'Action Commerciale - Université de Lyon)

  • Mohamed Firas Thraya

    (IDRAC Business school Lyon - Institut pour le Développement et la Recherche d'Action Commerciale - Université de Lyon)

  • Mohamed Zouaoui

    (CREGO - Centre de Recherche en Gestion des Organisations - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UB - Université de Bourgogne - UBFC - Université Bourgogne Franche-Comté [COMUE] - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE])

Abstract

Successfully achieving an integration strategy with a target depends on various factors. This paper examines how investor sentiment might influence the Merger and Acquisition (M&A) completion process. Using an international sample, the results indicate that a high level of investor sentiment significantly decreases the likelihood of a deal withdrawal and may lead bidders to make non-rational M&A decisions. Furthermore, cultural country factors such as collectivism, uncertainty avoidance, and masculinity accentuate the negative effect of investor sentiment on deal withdrawal, while strong institutions reduce this effect. Our findings are robust to several robustness checks.

Suggested Citation

  • Fabrice Hervé & Ibtissem Rouine & Mohamed Firas Thraya & Mohamed Zouaoui, 2024. "Investor sentiment and M&A withdrawal: International evidence," Post-Print hal-04779943, HAL.
    • Handle: RePEc:hal:journl:hal-04779943
    DOI: 10.1016/j.irfa.2024.103728
    as

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