The impact of agency problems on M&A performance in emerging markets
Merger and acquisition (M&A) is a method for firms to expand their organisation more rapidly than organically and a conduit for firms to expand their worldwide market position and increase competitiveness. M&A activity has expanded quickly in the 21st century, particularly in emerging countr...
| Main Author: | |
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| Format: | Dissertation (University of Nottingham only) |
| Language: | English |
| Published: |
2022
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| Online Access: | https://eprints.nottingham.ac.uk/68417/ |
| _version_ | 1848800485132206080 |
|---|---|
| author | Yap, Kha Ying |
| author_facet | Yap, Kha Ying |
| author_sort | Yap, Kha Ying |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | Merger and acquisition (M&A) is a method for firms to expand their organisation more rapidly than organically and a conduit for firms to expand their worldwide market position and increase competitiveness. M&A activity has expanded quickly in the 21st century, particularly in emerging countries. However, studies show that the acquiring firms did not achieve financial gain or even experienced loss post-M&A. Researchers indicate agency problems is a primary issue of corporate governance and remain a prominent issue in emerging markets that affect the M&A performance of the acquiring firms. Agency problems is divided into two categories: (1) divergence of interest between the shareholders and managers (principal-agent conflict); and (2) expropriation of minority shareholders (principal-principal conflict). The concentrated ownership structure of emerging market firms may alleviate principal-agent conflict. However, it is questionable whether mitigation of principal-agent conflict improves the M&A performance due to the presence of two sets of principals, majority shareholders and dispersed shareholders may result in principal-principal conflict.
Besides, the implication of principal-principal conflict on M&A performance is unclear due to limited studies conducted and conflicting results. Additionally, researchers provide a brief discussion of the link between principal-agent conflict and principal-principal conflict without providing empirical data. Hence, this paper seeks to investigate and provide empirical evidence on the impact of principal-agent and principal-principal conflicts on M&A performance and the relationship between principal-agent conflict and principal-principal conflict. By employing multiple linear and polynomial regression analyses, results show that alleviating principal-agent and principal-principal conflicts improves M&A performance. However, the ownership concentration must be maintained at certain level to prevent the principal-principal conflict. These findings can serve as a practical guide to the firms in corporate restructuring. |
| first_indexed | 2025-11-14T20:52:18Z |
| format | Dissertation (University of Nottingham only) |
| id | nottingham-68417 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T20:52:18Z |
| publishDate | 2022 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-684172022-07-25T05:48:37Z https://eprints.nottingham.ac.uk/68417/ The impact of agency problems on M&A performance in emerging markets Yap, Kha Ying Merger and acquisition (M&A) is a method for firms to expand their organisation more rapidly than organically and a conduit for firms to expand their worldwide market position and increase competitiveness. M&A activity has expanded quickly in the 21st century, particularly in emerging countries. However, studies show that the acquiring firms did not achieve financial gain or even experienced loss post-M&A. Researchers indicate agency problems is a primary issue of corporate governance and remain a prominent issue in emerging markets that affect the M&A performance of the acquiring firms. Agency problems is divided into two categories: (1) divergence of interest between the shareholders and managers (principal-agent conflict); and (2) expropriation of minority shareholders (principal-principal conflict). The concentrated ownership structure of emerging market firms may alleviate principal-agent conflict. However, it is questionable whether mitigation of principal-agent conflict improves the M&A performance due to the presence of two sets of principals, majority shareholders and dispersed shareholders may result in principal-principal conflict. Besides, the implication of principal-principal conflict on M&A performance is unclear due to limited studies conducted and conflicting results. Additionally, researchers provide a brief discussion of the link between principal-agent conflict and principal-principal conflict without providing empirical data. Hence, this paper seeks to investigate and provide empirical evidence on the impact of principal-agent and principal-principal conflicts on M&A performance and the relationship between principal-agent conflict and principal-principal conflict. By employing multiple linear and polynomial regression analyses, results show that alleviating principal-agent and principal-principal conflicts improves M&A performance. However, the ownership concentration must be maintained at certain level to prevent the principal-principal conflict. These findings can serve as a practical guide to the firms in corporate restructuring. 2022-07-23 Dissertation (University of Nottingham only) NonPeerReviewed application/pdf en https://eprints.nottingham.ac.uk/68417/1/Dissertation%20v.2%20%28final%29.pdf Yap, Kha Ying (2022) The impact of agency problems on M&A performance in emerging markets. [Dissertation (University of Nottingham only)] |
| spellingShingle | Yap, Kha Ying The impact of agency problems on M&A performance in emerging markets |
| title | The impact of agency problems on M&A performance in emerging markets |
| title_full | The impact of agency problems on M&A performance in emerging markets |
| title_fullStr | The impact of agency problems on M&A performance in emerging markets |
| title_full_unstemmed | The impact of agency problems on M&A performance in emerging markets |
| title_short | The impact of agency problems on M&A performance in emerging markets |
| title_sort | impact of agency problems on m&a performance in emerging markets |
| url | https://eprints.nottingham.ac.uk/68417/ |