Do the buy it?
Köper dem det?
Abstract
An increasingly popular tool for firms seeking growth, is to merge with or acquire other
firms. So popular that an entire industry of advisers has evolved to provide guidance
in the mergers and acquisitions (M&A) process. The most prominent are investment
banks (IB). However, an overwhelming amount of research have shown that the M&A
that firms choose to pursue on average destroy value. It is therefore in the interest of both
investors and management boards to know whether chief executive officers CEOs with
IB experience will do more or better M&A when hiring. To examine the effect of IB
experience, a model is developed and estimated on a sample of Swedish and Norwegian
large cap firms. From these estimations, we find that the odds of a firm with a CEO who
has IB experience doing M&A is 46% lower than if the CEO doesn’t have IB-experience.
However, no conclusions could be drawn on the effects on the quality of the M&A they
pursue
Degree
Student essay
Collections
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Date
2024-02-05Author
Frisell, Jesper
Lewerth, Gustaf
Series/Report no.
202402:51
Language
eng