The Factors That Affect the Acquirers' Decisions in India an Analysis through Case Studies

Abstract

Acquisition is one of the very important corporate investment decisions that an acquirer has to make. The consequences of this decision are reflected in the stock returns when an acquirer announces its decision to the market. This study analyses the factors that motivate the acquirers to go in for an acquisition and how the market reacts to the acquisition decision of the acquirers through case study analyses. Four different types of acquisitions are chosen and the factors that affect acquisitions and the acquirers' announcement returns is analysed. The analyses suggest the common motives for acquirers to go in for an acquisition are expansion and market penetration.