Publication detail

Efficiency of Mergers of Mechanical Engineering Companies in the Czech Republic

REŽŇÁKOVÁ, M. PĚTA, J.

Original Title

Efficiency of Mergers of Mechanical Engineering Companies in the Czech Republic

Type

journal article in Web of Science

Language

English

Original Abstract

This paper presents the research results in the field of the efficiency of mergers and acquisitions in the mechanical engineering industry of the Czech Republic. The aim of this paper is to determine whether mergers taking place in mechanical engineering are successful, or possibly to identify factors which may be deemed as synergies sources. In our research, the success rate of mergers is identified on the basis of the increasing revenues and operating profit. It has been established that out of mergers completed in 2004 – 2011, success has been achieved in approximately half of them. For this reason, we have focused on identifying the factors which may serve as the reasons for such a difference. The selected indicators of the cost-to-revenue ratio and utilization of fixed assets, investments, and net working capital we analysed before and after the mergers in both groups of successful and unsuccessful mergers. The Mann-Whitney U test was used to test the results. The research results have demonstrated that synergies are not achieved due to the change in the market power of the merged companied but owing to operational efficiency which is reflected in a drop in labour costs and depreciation to revenues ratios and increasing asset utilization.

Keywords

Cost efficiency, Investment in fixed assets and net working capital, Mann-Whitney U test, Mergers in mechanical engineering, Operating synergies.

Authors

REŽŇÁKOVÁ, M.; PĚTA, J.

Released

17. 12. 2016

Publisher

De Gruyter

ISBN

1213-2446

Periodical

Národohospodářdký obzor

Year of study

16

Number

4

State

Czech Republic

Pages from

361

Pages to

374

Pages count

14

URL

http://www.degruyter.com/view/j/revecp.2016.16.issue-4/revecp-2016-0020/revecp-2016-0020.xml?format=INT

Full text in the Digital Library

http://hdl.handle.net/11012/70150

BibTex

@article{BUT129485,
  author="Mária {Režňáková} and Jan {Pěta}",
  title="Efficiency of Mergers of Mechanical Engineering Companies in the Czech Republic",
  journal="Národohospodářdký obzor",
  year="2016",
  volume="16",
  number="4",
  pages="361--374",
  doi="10.1515/revecp-2016-0020",
  issn="1213-2446",
  url="http://www.degruyter.com/view/j/revecp.2016.16.issue-4/revecp-2016-0020/revecp-2016-0020.xml?format=INT"
}