Korean Management Science Review (경영과학)

The Korean Operations Research and Management Science Society (한국경영과학회)
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An Empirical Analysis of the Characteristics of Acquiring Manufacturing Firms in Korea : The Focus on Environmental Factors and Firm Performance

합병한 국내 제조기업들의 특징에 관한 실증적 연구 : 환경적 요인과 기업성과를 중심으로

  • Lee, Younsuk (Graduate School of Management of Technology, Sogang University) ;
  • Park, Soohoon (Moore School of Business, University of South Carolina)
  • 이윤숙 (서강대학교 기술경영전문대학원) ;
  • 박수훈 (사우스캐롤라이나 주립대학교)
  • Received : 2015.01.14
  • Accepted : 2015.03.12
  • Published : 2015.06.30
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Abstract

The M&A of firms has been emerged as the effective means of fast diversification and growth in dynamic environment. However, the empirical research about M&A in Korea has not been implemented rich due to the difficulty of obtaining M&A data. In this research, we empirically investigate the relationships among M&A, environment and firms' performance focused on Korean manufacturing firms, understanding the current practice of M&A in Korea. We use the Manufacturing Productivity Panel Survey Data, which are collected by Korea Productivity Center in 2013. The sample size is 575 and the sample is divided into M&A group and non-M&A group. We conduct logit analysis with the independent variables of environment factors (munificence, dynamic, uncertainty), and firms' performance (sales growth, ROS, labor productivity and Inventory turnover), and dependent variable of M&A group or non M&A group. The results show that M&A is closely related to environment feature and firm performance: M&A firms are likely to be the higher munificence and dynamic and the lower sales growth and higher profitability than non-M&A group. In addition, we also examine the characteristics of firms by M&A types (competitors, customer/supplier and firms from unrelated industry). These results imply that if firms confront the pressure of uncertainty (dynamic) and the lower growth, they tend to choose M&A. Futhermore, to profoundly understand the behavior of firms about M&A, it is required to classify the M&A firms by merge types.

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References

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