FINANCIAL OUTCOMES OF MERGERS AND ACQUISITIONS: ASSESSING SHORT-TERM GAINS AND LONG-TERM PERFORMANCE FOR ACQUIRING COMPANIES

Abstract

For a considerable amount of time, companies have used mergers and acquisitions (M&A) as strategic strategies to improve their competitive edge, create synergies, and raise shareholder value. By investigating the short- and long-term gains and performance of acquiring organizations, this study seeks to assess the financial results of M&A. Its primary objective is to determine the critical elements that impact the success or failure of these deals. The qualitative research approach of this study, which is based on secondary data, entails a thorough assessment of the literature and publication. The discussion highlights several crucial elements that affect M&A results, such as the difficulties in achieving synergies, the disparity between short-term market responses and long-term performance, the significance of cultural integration and strategic fit, the effects of payment methods and market timing, and the role of managerial objectives and regulatory concerns. New developments are also looked at, including the growing significance of technology-driven acquisitions and ESG considerations. Important conclusions draw attention to the intricate interactions among variables influencing M&A performance, the challenges in realizing expected synergies, and the significance of successful post-merger integration. The report also highlights the significance of cultural fit for merger success and the necessity of taking a long-term view when assessing M&A outcomes. Strengthening corporate governance, incorporating ESG considerations into M&A strategy, focusing on technology integration, mitigating risks in cross-border M&A, preparing for regulatory scrutiny, embracing a long-term perspective, prioritizing strategic fit and cultural due diligence, improving post-merger integration planning, and fostering a culture of continuous learning and adaptation are just a few of the recommendations. By presenting a thorough study of the variables impacting M&A outcomes and helpful advice for practitioners and policymakers in navigating the intricacies of M&A transactions, this research adds to the body of knowledge already in existence.