Mergers And Acquisitions In The Shipping Industry

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Andreas G. Merikas
Dionysios Polemis
Anna Triantafyllou

Keywords

logit regression, prediction, mergers and acquisitions, shipping

Abstract

The purpose of our research is to analyze Acquired and Acquiring companies in the Maritime Transport sector in order to determine whether the two groups can be distinguished from each other based on their different financial characteristics. Although this area of research is considered as very fruitful by many academics, it was given less attention due to the rare sequence of such events and the difficulty to gain access to valuable data. The authors are not aware of any other papers that have examined the maritime transport sector in such a way in the past.

However, since many shipping companies have taken the opportunity to access stock markets around the world, in order to gain equity finance to upgrade or expand their merchant fleets, their financial statements became public. Moreover, the fact that over the last decades Mergers and Acquisitions are considered by many managers as very efficient method of company expansion, the view of the past that considered Mergers & Acquisitions in the maritime sector as a difficult area of research is starting to change.

 The study will be based upon a sample of 60 companies, consisting of 37 targets (either through merger or acquisition), occurring during the calendar years from 1994 to 2009 and 23 acquirers (some of them multiple acquirers). In the analysis, ratios measuring different aspects of business activity will be investigated; such as profitability, liquidity, efficiency and leverage, with the utilization of multiple Logit Regression Analysis.

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