Friday, 16 July 2010

Investigation Into The Impact Of Merger And Acquisition Activities On Acquiring Companies

The primary focus of this research study is to investigate the impact of M&A activities on the shareholders of acquiring companies, by examining M&A that occurred in the UK Pharmaceutical sector in the period 2002-2006. To date most of the available knowledge on M&A comes from researches on US markets, with little research on UK markets. With references to M&A activities in the pharmaceutical sector, existing empirical literature tend to cluster exclusively on the US market or European market. This research attempts to broaden the scope of existing literature by going beyond the US and focusing on the UK.

This research aims to:

1. Critically evaluating if the shareholders of acquiring companies experience wealth effects as a result of M&A.
2. Replicate test that have been done on US data, to see whether similar result emerge for the UK. Each countries result may be unique because of different organizational and regulatory conditions. On the other hand similar results may occur if the market for corporate control is reasonable competitive in both countries and robust to definite institutional distinction.
3. Evaluating the impact of merger announcements on acquiring firm’s stock price using the UK Pharmaceutical sector.

Chapter One
Aims Of The Research
Scope And Limitation Of The Dissertation
Pharmaceutical Industry
Structure Of The Dissertation
Definition Of Key Terms
Types Of Mergers And Acquisition
Regulatory Bodies Involved In Takeovers And Mergers In The UK

Chapter Two
Literature Review
Distinction Between Mergers And Acquisition
Motives behind mergers and Acquisition
Synergy Motive
Taxes Motive
Managerial Motive
Diversification Motive
Driver Of Mergers And Acquisition
Cost of finance and stock market
Technological Advancement
Drivers of M& A in Pharmaceutical Sector
Mergers and Acquisition Trends
Effect of Mergers and Acquisition on Shareholder’s Value
Effect of Mergers and Acquisition in The Pharmaceutical Sector
Reason For Positive or Negative Merger and Acquisition Effect on Shareholders Value

Chapter Three
Research Method
Research Philosophy And Approach
The Even Study Approach
Assumptions Of The Event Study Method
Procedure When Using The Even Study Approach
Limitation of the Event Study Approach
Market Model Methodology
Sample Selection/Design

Chapter Four
Findings and Analysis
Abnormal Returns (Residual)
Cumulative Abnormal Returns

Chapter Five
Comparing Research Findings And Earlier Literature
Reliability and Validity of research work
Limitation And Suggestions For Further Research
Reflective Writing


Appendix Section
Appendix 1: Abnormal return for the Acquiring firm and the Average abnormal return for each day in the event window
Appendix 2: Estimation Of α And β For Cambridge Antibody Tech Group
Appendix 3: Abnormal Return Calculation For Cambridge Antibody
Appendix 4: Estimation Of α and β For Vernalis
Appendix 5: Calcualtion Of Abnormal Return For Vernalis
Appendix 6: Estimation Of α and β For Boots
Appendix 7: Calculation Of Abnormal Returns For Boots
Appendix 8: Estimation Of α and β For Ventura
Appendix 9: Calculation Of Abnormal Returns For Vectura
Appendix 10: Estimation of α and β For Celltech
Appendix 11: Calculation of Abnormal Returns for Celltech
Appendix 12: T- Stat Calculations

Download Here: Dissertation