Investor sentiment and M&A withdrawal: International evidence
Résumé
Successfully achieving an integration strategy with a target depends on various factors. This paper examines how investor sentiment might influence the Merger and Acquisition (M&A) completion process. Using an international sample, the results indicate that a high level of investor sentiment significantly decreases the likelihood of a deal withdrawal and may lead bidders to make non-rational M&A decisions. Furthermore, cultural country factors such as collectivism, uncertainty avoidance, and masculinity accentuate the negative effect of investor sentiment on deal withdrawal, while strong institutions reduce this effect. Our findings are robust to several robustness checks.