INTERNATIONAL CORPORATE ALLIANCES AND THEIR ROLE IN FINANCIAL VALUE GENERATION

Abstract

This study examines the value creation implications of global strategic mergers and acquisitions (M&As) using the synergy theory as its theoretical foundation. Employing a quantitative approach, the research analyzes the effectiveness of international alliances in generating financial value from M&As. Data spanning 39 years (1985–2023) were collected from the Institute for Mergers, Acquisitions and Alliances and analyzed using ordinary least squares (OLS) regression. Results indicate a positive and highly significant effect (p < 0.0001) of global M&As on financial value, confirming that well-executed international mergers and acquisitions produce substantial long-term financial benefits. The findings offer practical insights for business executives on the strategic value of cross-border alliances and provide empirical support for the synergy theory of M&As. Additionally, the study contributes a unique longitudinal perspective by employing global data over an extended period, addressing uncertainties in prior research and reinforcing the long-term financial benefits of M&As when strategically implemented. These results underscore the importance of strategic planning, careful execution, and international collaboration in enhancing corporate value through mergers and acquisitions.