企業 M&A의 長期成果에 관한 實證硏究

Abstract

This study tested the hypotheses regarding to long-run stock performance and long-run financial performance of the firms that had M&A events between 2003 and 2006. The long-run stock performance was measured by the cumulative abnormal return(CAR) from the market-model and control firm approach model. Both models resulted in negative CARs, therefore, the merging firms showed long-run stock performance. Those firms which listed in both KOSPI and KOSDAQ showed identical results, this results implied that there was no difference between two markets. To investigate the M&A firms' long-run financial performance, this study compared financial ratios of M&A firms with unconsolidated firms. As a result, for three years' activities for both groups, there was not any statistically significant difference. The merging groups even showed a lower performance than the unconsolidated company groups. Thus, there are no financially improved performance of merging firms. This study investigated five hypotheses for M&A firms by using cumulative abnormal returns. First, to verify the hypothesis of conglomeration effect of M&A, this paper compared the CARs between the M&A firms with conglomeration strategy and M&A firms without conglomerate strategy. As a result, the M&A companies without conglomerate strategy has the higher CARs, therefore the theory of conglomeration effect was not valid in the Korean market. Second, to investigate the hypothesis of size effect, this study compared CARs with the small sized M&A firms and large ones. The test showed that CARs of small firms have higher than the large one, so that the theory of the size effect was proved to be valid. Third, this study also compared CARs with value-stock firms with the glamour-stock firms in order to examine the performance extrapolation hypothesis. Since the value-stock firms showed higher CARs, the performance extrapolation hypothesis was accepted. Fourth, for the free cash flow hypothesis, this study compared the small cash firms with large cash firms. The results showed that M&A firms with large amount of cash had the higher CARs. Therefore, free cash flow theory didn't hold in the Korean stock markets. Finally, this study compared the low debt ratio firms with high debt ratio firms in order to prove the debt monitoring hypothesis. Although, the high debt ratio firms showed the higher CARs, the test did not come up with statistically significant results, so the debt monitoring theory was not valid in Korean market.