Abstract
In this chapter, Matsumoto examines 116 cases of Japanese outbound acquisitions. He determines that of these, only 9 can be conclusively judged successful, and 51 were failures. Matsumoto outlines three basic criteria for determining whether an overseas M&A is a success: the acquiring company’s survival, continuous ownership of the acquired firm, and a growth in firm profits. The author emphasizes that one must look at long-term, sustained profit growth rather than the immediate impact of the acquisition on share price to determine whether the acquisition was successful.
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Notes
- 1.
For example, in the case of an acquisition in 2000, the starting point is the operating profit of the acquiring company in fiscal year 2004.
- 2.
Overseas acquisitions conducted in the researchable period of 1985–2001.
- 3.
Acquisitions for industries that include acquisitions for speculative purposes (real estate, resources, and finance) are excluded from the analysis.
- 4.
Excluding cases where more than 50% of the shares were acquired after the acquisition, minority ownerships, and joint ventures.
- 5.
- 6.
Extracted from the data of Thomson Reuters.
References
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Matsumoto, S. (2019). Measuring Performance of Japanese Outbound Acquisitions. In: Japanese Outbound Acquisitions. Palgrave Macmillan, Singapore. https://doi.org/10.1007/978-981-13-1364-6_3
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DOI: https://doi.org/10.1007/978-981-13-1364-6_3
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