Abstract
As mergers and acquisitions (M&A) become more and more frequent around the world, the phenomenon of the extreme premium in mergers and acquisitions has begun to expose to the public and attract the widespread attention of scholars. In particular, in recent years, Chinese enterprises have been extremely overpriced in mergers and acquisitions. Based on this, the paper reviews the literature about the determinants of M&A premium and the related theories from three aspects: macro environment factors, business factors and management factors. Finally, the shortcomings of the existing research are analyzed and the prospect of the future research is put forward.
Highlights
In the face of the integration of world economy, more and more enterprises have actualized their first step of internationalization through cross-border mergers and acquisitions (M&A)
According to the M&A data released by Shanghai and Shenzhen in 2016, nearly 70% of the listed companies have a premium rate of over 50%, of which 164 companies have a premium rate of 1000%, and high premium mergers and acquisitions are common
Whether the determinants of M&A premiums found in existing studies can explain the phenomenon of M&A premiums in emerging economies theoretically, whether they can help emerging economies to determine the reasonable payment price when making overseas M&A, whether they are applicable to the pricing problem of foreign M&A in emerging economies, or whether they are applicable to small-scale M&A transactions, etc., are all issues worthy of attention in follow-up studies
Summary
In the face of the integration of world economy, more and more enterprises have actualized their first step of internationalization through cross-border M&A. As a result, pricing, as the primary problem faced by the two parties in the process of overseas mergers and acquisitions, will have an important impact on efficiency of M&A. According to the M&A data released by Shanghai and Shenzhen in 2016, nearly 70% of the listed companies have a premium rate of over 50%, of which 164 companies have a premium rate of 1000%, and high premium mergers and acquisitions are common. In view of this phenomenon, scholars both at home and abroad have carried out a lot of relevant research. In order to provide some enlightenment for the study of M&A premium in China as well as bring some guiding significance to the Chinese enterprises, it analyzes the possible shortcomings in the existing research, and puts forward the future research direction on this basis
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