Successful Cross-border Acquisitions of Latin American Financial Institutions: Identifying Success Factors

This article examines the shareholder wealth effects for foreign companies that announce acquisitions of financial institutions in Latin America. We examine data for 636 transactions for the period 1985–2009. We employ event study methodology coupled with a cross-sectional regression to determine if...

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Bibliographic Details
Published inGlobal journal of emerging market economies Vol. 4; no. 3; pp. 347 - 367
Main Authors Aybar, C. Bülent, Jeffus, Wendy M., Edmunds, John C.
Format Journal Article
LanguageEnglish
Published New Delhi, India SAGE Publications 01.09.2012
Subjects
Acquisitions
Banks
Emerging markets
Financial institutions
Financial intermediaries
Latin America
Stockholders
Cross-border acquisitions
financial intermediaries
Latin American market
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Summary:This article examines the shareholder wealth effects for foreign companies that announce acquisitions of financial institutions in Latin America. We examine data for 636 transactions for the period 1985–2009. We employ event study methodology coupled with a cross-sectional regression to determine if shareholders of the acquiring firm receive positive returns. The results indicate that acquirers receive positive returns when the acquisition involves a target bank in a market with low market access, high market risk, and greater control post acquisition. These findings offer improvements on previously examined variables and provide insight into a market not sufficiently examined in prior research.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
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ISSN:0974-9101
0975-2730
DOI:10.1177/0974910112459699