Social Sector

Citation:

Ismail, T. H., A. A. Abdou, and R. M. Annis, "Exploring Improvements of Post-Merger Corporate Performance- the Case of Egypt", The IUP Journal of Business Strategy, 2011.

Abstract:

This paper examines the operating performance of a sample of Egyptian companies involved in Mergers and Acquisitions (M&A) transactions for the period 1996 to 2003. The analysis is based on the accounting measures to test the effects of M&A on the corporate performance of the construction and technology sectors. The study tests two hypotheses: first, whether there have been significant improvements in corporate performance following the M&A event, and second, whether the industry sector has an impact on the corporate performance. Empirical results revealed that some measures of corporate performance like profitability, suggested statistically significant gains in the years following M&A, especially in the construction sector. Other performance measures such as efficiency, liquidity, solvency, and cash flow position do not show significant improvements after mergers in the short-run analysis in both the sectors. The paper concludes that mergers in the Egyptian technology sector do not lead to improved corporate performance in the short run. The findings of this study significantly contribute to the empirical literature on M&A in the emerging markets of Egypt.

Notes:

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