Structural Risk Modelling-Indian Mergers & Acquisitions

Bhattarai, Keshab; Prasuna, Asha; Siva Kumar, S N V

Abstract

Primary survey data of Indian M&A transactions were used to test the hypotheses on latent risk factors. A structural equation model (SEM) model was estimated to assess the composite risk factors considering financial, non-financial, and sustainability risks. The results reveal that reforms in management and human resources can control up to 23 percent of overall risk. Ensuring appropriate technology will take away another 22 percent risk. Macroeconomic stability can reduce risks of the firms by 12 percent. Then sustainability factors reduce risk by 11 percent and another 11 percent of risk can be controlled by a sound financial sector. Thus overall novelty of this research is to critically evaluate the existing framework and propose a holistic M&A risk assessment model that captures contemporary technical, management and HR, economic issues underlying challenges of business enterprises in India. The research gap in assessing sustainability M&A risks is an extended version of the existing M&A synergy gain theory.

Citation

Bhattarai, K., Prasuna, A., & Siva Kumar, S. N. V. (2025, January). Structural Risk Modelling-Indian Mergers & Acquisitions. Paper presented at 2025 ASSA Annual Meeting, San Francisco, California

• Presentation Conference Type: Conference Paper (unpublished)
• Conference Name: 2025 ASSA Annual Meeting
• Start Date: Jan 2, 2025
• End Date: Jan 5, 2025
• Acceptance Date: Jan 4, 2025
• Online Publication Date: Jan 5, 2025
• Publication Date: Jan 5, 2025
• Deposit Date: Jan 14, 2025
• Publicly Available Date: Feb 13, 2025
• Peer Reviewed: Peer Reviewed
• Keywords: Rating and Rating Agencies; Financial Risk Management; Mergers & Acquisitions; JEL Classification: G24; G32; G34
• Public URL: https://hull-repository.worktribe.com/output/5003852
• Publisher URL: https://www.aeaweb.org/conference/2025/program?q=eNpNzDEOwjAMheG7vDkDHbr0HFxcwCQWtdSSyLZAVZW741wwA9v33vCfMCbNK5YzZCb1cT0a_00smNATMjnfqx6xkUBmNX_prHvotpI7KUlcXE_h10gUdpKNy6eRoK2F5svIFfqVXFx2Hur9DZ60K5s%2C