Impact of Industry Specificity on High-Tech M&A Performance in Developed Capital Markets

The main aim of the paper is to investigate the influence of industry specificity on the high-tech M&A deal performance. In the first chapter of the paper there is conducted the literature analysis. The second chapter describes the methodology of the research. The last chapter of the paper consists of empirical analysis. The industry specificity consists in the different motives for acquirer to participate in the deal. The array of variables was chosen as proxies for motives and its influence on the high-tech M&A deals performance of the acquirer was investigated by regression analysis. M&A performance was calculated by means of CAR. We have found the higher return of high-tech M&A deals if the acquirer is also a high-tech company. Regression analysis of the data allowed us to prove several hypotheses made after the literature review. The main motives for M&A in medical equipment and biotech industries are R&D mass accumulation for the acquirer, the potential increase in the scale of operation and the ability of the acquirer to efficiently transform the R&D investments into the market value of the company. Software companies in M&A follow the motives of R&D acquisition, increase in the scale of operations accompanied by low ability of the target to create companies’ market capitalization using R&D. Acquirers in the computer and electrical equipment industry pursue the goal to obtain a high performing company and create R&D synergy by M&A.