Accounting performance of distressed M&A for public and private targets

• Autor(a) principal: Kolberg, Kevin
• Data de Publicação: 2021
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/143112
• topic: Directed research; Mergers and acquisitions; Accounting performance; Private and public targets; Distressed targets; Domínio/Área Científica::Ciências Sociais::Economia e Gestão

This paper compares the effect of M&A on accounting metrics between deals in which a distressed target is acquired and deals with non-distressed targets. The change in performance metrics pre-to post-deal is found to be lower, i.e. more negative, for the distressed group. However, controlling for other factors, the target’s distress status is only significantly correlated with changes in selected metrics. The relation is weaker in a sub-sample including deal values. Conclusively, distressed deals underperform non-distressed situations overall but the target’s distress status cannot be identified as a significantly correlated variable across performance metrics and distress measures.