INTERNATIONAL TAKEOVERS: A COMPETITIVE ACQUISITION MARKET

국제기업합병: 경쟁적 인수시장

This study investigates the wealth effect of foreign acquisition of U.S. based firms. Contrary to previous studies, this analysis demonstrates that after appropriate control of domestic-acquired targets, the wealth gains to the shareholders of targets in foreign takeovers are similar to those in domestic takeovers. This paper investigates the validity of the competitive acquisition market in cross-border takeovers and concludes that : 1) in cases of inward foreign direct investment into the U.S., foreign firms do not realize significant net benefits from acquisitions; and 2) the foreign acquirer is as well informed as its U.S, counterparts about the target's market. The results of this study are consistent with the view that each country has different motivations for investing in the U.S. market. Consider, for example, Japan. The evidence suggests that Japanese companies pay a considerable price for U.S. targets which have performed poorly before the takeover. While there is no specific rationale to explain why Japanese firms buy the most volatile and worst performing firms, international barriers may provide a possible reason for these anomalies. Overall, the evidence of this paper supports the view that foreign takeovers occur in a competitive acquisition market.