| Abstract [eng] |
68 pages, 24 charts, 5 pictures, 42 references. The main objective of the Master Degree thesis is to analyse the impact of mergers on companies' financial indicators by assessing the counterfactual situation if the companies had not been merged. The thesis consists of three main parts: literature study, the analysis of the research and its methodology, the conducted research and obtained results. The literature review examines three main aspects of mergers. Firstly, the motivations for mergers and their advantages and disadvantages are discussed. Secondly, the possible types of mergers are described and, finally, the methods of merger evaluation are analysed. The methodology part describes the study sample. The research examined four mergers involving 8 companies listed on US stock exchanges. The sample of financial data employed was the 10-year pre-merger financial figures, with some exceptions, for certain companies. The collected data were used for counterfactual analysis, i.e. the financial performance of the individual companies for the next two years was forecasted and compared with the financial data of the merged company. The merger had to take place in 2019-2020 as the year in which the merger was finalised was not included in the study. The following two years were used for comparison, based on studies already carried out, which suggest that this is a sufficient period for the benefits of the merger to be revealed. A comparison of the predicted financial indicators of the individual companies with the actual indicators of the merged company produced ambiguous results. In three out of four cases, the predicted financial indicators of the separate companies were better than those of the merged company. However, there was a tendency in the results that the difference between the indicators of the separate and the merged company decreased in the second year after the merger. Similarly, in the merger of CenterPoint Energy, the only company where the merger outperformed the stand-alone companies, it was possible to observe that in the first year after the merger only operating profit exceeded the stand-alone companies' result, while in the second year all the indicators calculated were higher. Summarising it is feasible to state that mergers have a negative impact on financial performance in the first two years after the merger. Yet, there is a positive tendency in the indicators, which may demonstrate that the two-year study period is too short for the true benefits of the merger to become apparent. |
