Journal of Accounting, Finance & Management Strategy





Volume 11, Number 1, June 2016

Shareholder Wealth Effect of M&A Patterns and Industry Competition in Taiwan: The Perspective of Competitive Dynamics


Facing rapid technology development, and in response to international competition, M&As (mergers and acquisitions) are gradually increasing. Many studies in Taiwan have discussed M&As, but they seldom focus on related financial and accounting issues, the integration of culture, the talent assets of multinationals or the enhancement of competitiveness by M&As. Few studies have discussed the positive or negative impact of M&A announcements on the stock returns of the merging company. Therefore, this study attempted to investigate the M&A events announced, using the event study method to analyze the competitive dynamics-derived competitor analysis architecture as the classification sample indicator. The findings could be used as a reference for merging companies preparing for M&As, in the consideration of whether the stock returns change after the M&A will bring advantages or threats to the company. According to the research findings, under the assumption of market commonality and resource similarity, a significantly negative AR rate will occur on the event date, indicating that the market will immediately react to the M&A behavior of the enterprise with a significantly negative effect.

Keywords: M&A, Competitive Dynamics, Competitor Analysis, Market Commonality, Resource Similarity

JEL Classification: G14, M10