The short-term stock market reaction to cross-border M&As and the impact of the asset seeking motive: The case of Indian firms.

During the last decade the number and value of cross-border M&As by emerging market firms has increased. This thesis examines the stock market reaction to Indian cross-border M&A announcements and the impact of the strategic asset seeking motive on this stock market reaction using the event study methodology and OLS regression models. I find support for a positive stock market reaction, i.e., positive cumulative abnormal returns. A positive impact of the strategic asset seeking motive is only partly supported. There is support for the positive impact of the target being located in a developed country. However, there is no support for the positive impact of the bidder being active in the service sector. There is also no support for a positive association between the level of technology exports in the host country and cumulative abnormal returns.