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Why do some merger and acquisitions deals fail? A global perspective

Attah-Boakye, Rexford; Guney, Yilmaz; Hernandez-Perdomo, Elvis; Mun, Johnathan


Rexford Attah-Boakye

Yilmaz Guney

Elvis Hernandez-Perdomo

Johnathan Mun


We analyze why some merger and acquisitions (M&A) deals are withdrawn paying particular attention to the economic freedom and legal environment of countries. We use a large dataset based on deals worldwide from over 140 countries during the period 1977 to 2014. Our core finding is that the likelihood of a deal’s withdrawal tends to increase if the economic freedom/ quality of legal environment of the acquiring (target) firm’s country is higher (lower). These core findings matter more for the non-financial sector, during non-crisis years, and in developed financial markets. We also report that the deals have higher tendency to be withdrawn if the target firm’s size is larger or its profitability is lower; and the acquiring firm’s size is smaller. Furthermore, our analyses reveal that deal characteristics (i.e., deal attitude, means of payment, deal size, ownership sought) also matter in affecting the outcome of announced M&A deals.


Attah-Boakye, R., Guney, Y., Hernandez-Perdomo, E., & Mun, J. (in press). Why do some merger and acquisitions deals fail? A global perspective. International journal of finance & economics : IJFE,

Journal Article Type Article
Acceptance Date Jun 18, 2020
Online Publication Date Aug 5, 2020
Deposit Date Jun 20, 2020
Publicly Available Date Aug 6, 2022
Journal International Journal of Finance and Economics
Print ISSN 1076-9307
Electronic ISSN 1099-1158
Publisher Wiley
Peer Reviewed Peer Reviewed
Keywords Mergers and acquisitions; Deal failure; Economic freedom; Institutional environment; Firm size and profitability
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