| Title: |
Social Trust Distance in Mergers and Acquisitions |
| Authors: |
Lin, TC; Pursiainen, V |
| Publication Year: |
2023 |
| Collection: |
University of Hong Kong: HKU Scholars Hub |
| Description: |
We study the role of regional cultural differences in M&A transactions in the U.S. A larger social trust distance between two companies reduces the likelihood of them combining via an M&A transaction and results in lower completion rates and longer completion times, indicating higher complexity in deal execution. However, a larger social trust distance is also associated with higher gains from mergers, as measured by acquirer and combined announcement returns and medium-term buy-and-hold abnormal returns. This suggests that for these announced deals, the synergy potential is high enough to offset the costs induced by the large cultural distance. |
| Document Type: |
article in journal/newspaper |
| Language: |
English |
| Relation: |
Journal of Banking & Finance; Journal of Banking & Finance, 2023, Forthcoming, p. 106759; 106759; 343625; WOS:000931417600001; https://hub.hku.hk/handle/10722/324854; Forthcoming |
| DOI: |
10.1016/j.jbankfin.2023.106759 |
| Availability: |
https://hub.hku.hk/handle/10722/324854; https://doi.org/10.1016/j.jbankfin.2023.106759 |
| Accession Number: |
edsbas.89DD1A16 |
| Database: |
BASE |