Impact of acquisitions on Short- and Long-term value creation at microsoft corporation, period of 2012-2021

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Ghanim, Ahmad Hanif (2023) Impact of acquisitions on Short- and Long-term value creation at microsoft corporation, period of 2012-2021. Graduate thesis, Sekolah Tinggi Manajemen Ipmi.

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Abstract

Mergers and acquisition (M&A) is a business strategy that companies can use in their quest to continuously deliver value to their stakeholders. One of the industries where M&A is a dominant strategy is the enterprise technology sector, which has seen various groundbreaking deals in the last several years. Among the various players in the industry, Microsoft corporation has conducted various M&A activities in the past, acquiring companies that either complement their existing products and services, or allow them to reach a new market segment altogether. This study aims to understand how Microsoft has created value in the short-and long-run, for both their shareholders and the company itself. Long-term value creation will be measured by proxy of profitability, liquidity, activity, solvency, and shareholder wealth generation financial ration, with a goal to see whether there has been significant changes in those domains over a ten-year observation period from 2012 to 2021. Short-term value creation is measured by way of event studies, assessing whether abnormal returns were evident around the acquisition announcement dates of four sample events. Both value creation observations were then subject to hypothesis testing bu way of paired t-tests. Long-term value creation was evident on activity, liquidity, and shareholder wealth creation, while short-term value creation was only evident in one acquisition announcement. Companies could be best off by focusing on long-term value creation as well as designing strong integration capabilities to deliver long-term value.

Item Type: Thesis (Graduate)
Subjects: H Social Sciences > H Social Sciences (General)
Divisions: Thesis > Master of Business Administration
Depositing User: Dede Faujiah
Date Deposited: 12 Dec 2023 01:50
Last Modified: 12 Dec 2023 01:50
URI: http://repository.ipmi.ac.id/id/eprint/2299

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