Review of Past Studies on Post M&A Performance in Manufacturing Sector: The Road Not Taken in India

Abstract

This paper aims to portray literature review on firm financial performance during post mergers and acquisitions period and find the gaps areas to make study on M&A in India. Design/methodology/approach- Based on sixty four papers published between 1974 and 2015, review of M&A articles is based on various aspects of M&A performance like financial, human resources, corporate governance/ ownership, cross border/ culture, merger wave, business cycle, type of deal, type of industry. The paper classifies the existing literature into various sections, identifies the gaps, and suggests the scope for future research. In the light of literature review made, studies have been classified based on the evaluation process of M&A financial performance of firms-either accounting based or event study based or combination of both. Findings- Literature has shown mixed results. From literature, there is no conclusive evidence about the impact of M&A on corporate performance. M&A deals have gone up manifold in India in recent years. Earlier studies were based on a limited number of merger and acquisition items. Hence there is a need to relook at the post M&A performance India. As far as literature review is concerned, studies with respect to post M&A performance in terms of economic profit- which is supposed to be the true profit for shareholders- are few, particularly in India. Studies taking into account the non-financial factors need to be focused.