Impact of Merger and Acquisitions on the Financial performance of the Selected Companies of India

Abstract

The main objective of this research work is to analyze the impact of MandA activity on the newlinefinancial performance of the companies by comparing pre and post financial performance of newlinethe selected companies of India. For the purpose of study, 3 sectors are selected on the basis newlineof the highest growth in volume of deals as well. The year 2015 is selected as the year of newlineacquisition as from 2014-2018 highest deals were done in the year 2015 i.e., 570 deals. newlineCompanies under study are selected on basis of Market Capitalization comprising of Top 10 newlinecompanies in each sector listed on BSE and have undergone acquisition in 2015. The study is newlineundertaken to compare the pre and post financial performance with relation to (-3, +3) years newlinein order to understand the impact of MandA activity. Various financial ratios relating to newlineprofitability, liquidity and management efficiency have been selected on the basis of literature newlinereview. The study is completely based on secondary data. For the statistical analysis, Paired newlineT-test has been used for comparison of pre and post-performance. Apart from this for Inter newlineand Intra sector comparison, One Way ANOVA along with Tukey Post Hoc Test have been newlineused to find out the impact of MandA activity in between the sectors as well as companies. The newlinefindings indicate that overall, there has been no major improvement in any of the companies newlinepost-Acquisition. However, in some areas there has been improvement but overall, the impact newlineis negative. Also, there is evidence of difference in performance between the sectors as well as newlinebetween the companies. newline newline