Impacts of mergers and acquisitions announcements on stock performances in technology industry in U.S. market

Abstract

This study is designed to determine if mergers and acquisitions (M&A) can create value for companies in U.S. technology industry. The abnormal return around the announcement date and the significance of cumulative abnormal returns confirm that M&A has positive impact on stock performance of these companies. Also, this study runs a regression of standardized cumulative abnormal return on some factors that may influence the results to see which factors have influence and to examine to which degree they influence the results of M&A deals. The conclusion is that size, liquidity, and profitability of the acquirer and type of the payment influence the result of M&A deals.