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Geographical peer effect in serial mergers and acquisitions: The influence of social learning and director network.

Authors :
Zhang, Xiaoxu
Song, Yu
Liao, Qiaoran
Source :
PLoS ONE; 12/21/2023, Vol. 18 Issue 12, p1-26, 26p
Publication Year :
2023

Abstract

Based on the serial mergers and acquisitions(M&A) data of Chinese A-share listed companies from 2010 to 2019, this paper discusses whether there are geographical peer effects in serial M&A, and tests its mechanism and influence path. The empirical study shows that geographical peer decision-making has geographical peer effects in the decision-making of serial M&A, and the average number of serial M&A of geographical peers has a significant positive impact on the serial M&A decision-making of focal firms. Social learning and director networks are essential to produce geographical peer effects in serial M&A. The external learning mechanism shows that the geographical peer effect of serial M&A decision-making is partly caused by backward firms' social learning to the leading peer firms' decision-making, but vice versa. The director network relationship of focal firms can positively moderate the relationship between the geographical peer firms' average serial M&A decision-making and the focal firm's serial M&A decision-making. This paper reveals the mechanism of geographical peer effect in serial M&A decision-making and provides a new perspective to understand the motivation of serial M&A decision-making. These empirical findings not only provide important empirical evidence on serial M&A from developing countries such as China, but also provide a valuable reference for decision-makers and researchers of serial M&A in the future. [ABSTRACT FROM AUTHOR]

Details

Language :
English
ISSN :
19326203
Volume :
18
Issue :
12
Database :
Complementary Index
Journal :
PLoS ONE
Publication Type :
Academic Journal
Accession number :
174389055
Full Text :
https://doi.org/10.1371/journal.pone.0294950