《企业兼并后财务状况分析【外文翻译】》由会员分享，可在线阅读，更多相关《企业兼并后财务状况分析【外文翻译】（12页珍藏版）》请在金锄头文库上搜索。
1、本科毕业论文（设计） 外 文 翻 译原文：原文：Firm Financial Performance Following Mergers2. Hypotheses2.1. Long-term performance plansThe interests of managers and stockholders can potentially be aligned by management compensation plans. Long-term performance plans may lengthen a managers decision-making horizon since t
2、he performance plan compensation is deferred until the end of the award period and forfeited if the manager leaves during the period. Managers who are compensated only by a salary and bonus program may have a shorter decisionmaking horizon. Smith and Watts (1982) suggest that short-term bonuses give
3、 managers incentives to choose negative net present value projects that impose expenses after the manager retires and to turn down positive net present value projects with a long horizon.The horizon issue is further examined by Narayanan (1985) whose model shows that managers select projects yieldin
4、g short-term profits to enhance the perception of their ability quickly and thus earn higherwages. This might be done by managers even though the project is not the one with the highest net present value. Tehranian, Travlos and Waegelein (1987) provide evidence that firms with long-term performance
5、plans experience more positive abnormal returns at merger announcements than firms without these plans. Thus, our first hypothesis is that firms who compensate their managers with long-term performance plans will experience more positive post-merger financial performance than firms that do not have
6、these plans.2.2. Method of paymentThe influence of method of payment on post-merger financial performance is ambiguous. Corporate finance theory suggests that the method used to finance a corporate acquisition should produce different valuation effects on the bidding firms stock prices because of si
7、gnaling effects. The signalling hypothesis rests on the assumption that managers have inside information regarding the true value of the firm. This hypothesis predicts that managers, acting in the best interest of existing stockholders, would prefer a cash offer if they believe their firm is underva
8、lued and a common stock offer if overvalued (see Myers and Majluf, 1984; and DeAngelo, DeAngelo and Rice, 1984). Market participants might therefore interpret a cash offer as good news and a common stock offer as bad news. Empirical evidence (Travlos, 1987) suggests that cash financing is associated
9、 with more positive abnormal returns at merger announcements by bidding firms.However, firms that pay for an acquisition in cash typically have large debt payments to make following the acquisition. These debt payments could have a negative impact on post-merger financial performance. Although we co
10、mpute cash flow returns before deducting interest expense, the additional interest expense could reduce the firms ability to invest in other areas (i.e., R&D and capital equipment) that could have a significant impact on sales and performance. The direction of the effect, if any, is an empirical que
11、stion.2.3. The market for corporate controlJarrell and Poulsen (1987) and Tehranian, Travlos and Waegelein (1987) provide evidence that bidding firms experienced significantly positive abnormal returns at the announcement of a merger during the 1970s, but experienced insignificant abnormal returns d
12、uring the 1980s. Jarrell and Poulsen (1987) claim that this secular decline in stock returns reflects increased competition among bidders, changes in regulations affecting mergers which required more disclosure, and the rise of auction-style contests during the 1980s. Herman & Lowenstein (1988) also
13、 found conflicting results over different merger periods. In light of this evidence, our third hypothesis is that bidding firms that announce a merger after 1982 will experience poorer post-merger financial performance than bidding firms that announce a merger before 1983.2.4. Hostile takeoversWheth
14、er the acquisition is hostile or friendly should also have an effect on post-merger financial performance. When a merger is friendly, both sides usually reach agreement on the terms and this should signal a willingness to work together. Integrating the combined company should be less stressful. With
15、 hostile takeovers, often there is a bidding war that takes place to acquire the company. The bad feelings that could have developed during the takeover attempt could result in problems with the integration of the two companies. The fourth hypothesis is that firms who combine through a friendly take
16、over will have more positive post-merger financial performance than firms who combine through a hostile takeover.2.5. Industry relatednessIt is unclear what the impact on post-merger financial performance will be if the acquiring and target firms are in dissimilar industries. Firms in similar industries might achieve synergies and cost savings by eliminating overlapping areas. However, it might be more difficult to combine similar companies because it could mean asset sales, plant closings
