Does the Quality of Institutions and the Regulatory Bodies Influence Deal Duration in M&As?

Cai, Yingdan; van Ees, Hans; van Veen, Kees; Gubbi, Sathyajit

Abstract

The speed with which a merger and acquisition (M&A) deal is completed or the number of days taken from the announcement of the deal until its completion is an important barometer of the success and efficiency of a deal. In this paper, we apply the institutional-based view to propose that in the context of acquisitions by emerging market firms, the deep embeddedness in the institutional environment is likely to influence deal duration. Our theoretical model speculates on the effect of the quality of home and host country institutional environment in cross-border acquisition deal duration. We further propose that the number of regulatory agencies involved has a bearing on deal duration. The hypotheses are tested using a unique sample of both domestic and international acquisitions with non-zero duration dates by Brazilian firms between 2000 and 2014. The findings supported our conjectures.

Citation

Cai, Y., van Ees, H., van Veen, K., & Gubbi, S. (2015, June). Does the Quality of Institutions and the Regulatory Bodies Influence Deal Duration in M&As?. Paper presented at Academy of International Business 2015 Annual Conference, Bengaluru

• Presentation Conference Type: Conference Paper (unpublished)
• Conference Name: Academy of International Business 2015 Annual Conference
• Conference Location: Bengaluru
• Start Date: Jun 27, 2015
• End Date: Jun 30, 2015
• Acceptance Date: Mar 1, 2015
• Publication Date: Jan 1, 2015
• Publicly Available Date: Jun 6, 2019
• Peer Reviewed: Peer Reviewed
• Keywords: deal duration, mergers and acquisitions, institutional distance, institutional quality, regulatory agencies
• Public URL: https://uwe-repository.worktribe.com/output/841104
• Publisher URL: https://aib.msu.edu/events/2015/
• Additional Information: Title of Conference or Conference Proceedings : Academy of International Business 2015 Annual Conference