Journal of Business Accounting and Finance Perspectives

(ISSN: 2603-7475) Open Access Journal
JBAFP 2020, 2(3), 20; doi: 10.35995/jbafp2030020

Glamorous Acquisitions in Telecommunications after the Market Liberalisation: Success or Failure?

Received: 10 Mar 2020 / Revised: 9 Jul 2020 / Accepted: 2020-08-11 / Published: 2020-08-29
Download PDF (405kb)

ABSTRACT

The academic literature indicates that “glamour” influences the investor’s behaviour. This article analyses the performance and value creation of the glamorous operations of mergers and acquisitions (M&A) in the telecommunications sector, trying to understand if these operations are conducive to stockholder wealth maximization. To conduct this analysis, the telecommunications M&A that occurred in the convulsed period of the internet bubble were counted as samples (1995–2010). The research concludes that glamour tends to be opposite to value creation in the long run: the glamour firms show significant value destruction and worse performance than non-glamour firms. Certain acquirers’ characteristics, such as size, are determinant in the glamour behaviour. This paper combats the shortage of research of a quantitative sectoral nature on telecommunications M&As, when leading international companies like Vodafone, Cable and Wireless, France Telecom or Telecom Italia are very active in this kind of operations.
Keywords: M&A; glamorous acquisitions; strategy; telecommunications; CTAR
OPEN ACCESS
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).
CITE
Navío-Marco, J.; Calle, S.S.; Solórzano-García, M. Glamorous Acquisitions in Telecommunications after the Market Liberalisation: Success or Failure? JBAFP 2020, 2, 20.
Navío-Marco J, Calle SS, Solórzano-García M. Glamorous Acquisitions in Telecommunications after the Market Liberalisation: Success or Failure? Journal of Business Accounting and Finance Perspectives. 2020; 2(3):20.
Navío-Marco, Julio; Calle, Silvia Serrano; Solórzano-García, Marta. 2020. "Glamorous Acquisitions in Telecommunications after the Market Liberalisation: Success or Failure?" JBAFP 2, no. 3: 20.
Not implemented
SHARE

Article Versions

Export Article

Journal Browser