Browse by author
Lookup NU author(s): Dr Yousry AhmedORCiD
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License (CC BY-NC 4.0).
Abstract Purpose – This paper examines the effect of family ownership on the payment method of mergers and acquisitions (M&A) deals. It also investigates the market reaction around the announcement of these M&A deals. Design/methodology/approach – Archival data of M&A deals of a sample of Taiwanese listed firms during 2008-2018 are collected and examined using probit, event study and OLS models. We address the endogeneity concern using the two-stage least squares (2SLS) statistical technique and Heckman’s two-step estimation method. Findings – We find that family firms are more likely to use cash as an exchange medium in M&A deals to avoid the problem of diluting control rights. We further find that family firms receive a positive market reaction around the announcement of M&A deals relative to non-family counterparts. Our empirical results support the notion that family ownership is a value-creation structure. Practical implications – Our findings provide additional evidence-based insights into the debate about family ownership with the aim of informing policy and offering practical recommendations to expand the US-based literature. Originality/value – To the best of our knowledge, this is the first study to provide empirical evidence on the impact of family ownership on payment method choice in M&A activities in Taiwan. It also provides novel evidence that family firms experience value gains when taking M&A investment decisions relative to non-family firms.
Author(s): Ahmed Y, Elsayed M, Chen Y
Publication type: Article
Publication status: Published
Journal: International Journal of Accounting and Information Management
Year: 2023
Volume: 31
Issue: 3
Pages: 440-454
Online publication date: 23/03/2023
Acceptance date: 17/02/2023
Date deposited: 18/02/2023
ISSN (print): 1834-7649
ISSN (electronic): 1758-9037
Publisher: Emerald Publishing Limited
URL: https://doi.org/10.1108/IJAIM-10-2022-0231
DOI: 10.1108/IJAIM-10-2022-0231
ePrints DOI: 10.57711/bxbq-wc91
Altmetrics provided by Altmetric