Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5103586 | The Quarterly Review of Economics and Finance | 2017 | 12 Pages |
Abstract
This study investigates the value of customer/supplier relationships in mergers and acquisitions. The findings indicate that targets (suppliers) with strong customer/supplier relationships obtain higher abnormal returns and higher merger premiums when compared to targets with weak customer/supplier relationships. However, targets with a strong connection to a customer have a lower chance of being acquired. Acquirers that purchase targets with strong customer/supplier relationships have negative long run abnormal returns suggesting that the acquirers may have overpaid for these targets. The implications of customer/supplier relationships on customers, rivals, and competing rivals are presented.
Related Topics
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Authors
Marcin W. Krolikowski, Hari P. Adhikari, James Malm, Nilesh B. Sah,