A Real Options Perspective on Sequential Acquisitions in China, Annotated Bibliography Example

Huang Jiayin (2010). The effects of mergers and acquisitions and the evidence from China Proquest dissertation and theses (PQDT) pg. n/a

The paper examines the effects wealth and operating performance of Chinese companies and organizations in mergers and acquisitions. The paper postulates and proves that shareholders earn positive results upon announcements of mergers and acquisitions but no further movements occur post with. The main findings are that first Chinese acquire companies that are private subsidiaries in related fields. This in my evaluation is probably a way for the company to grow. Second Acquiring firms are viewed positively by shareholders and moderately abnormal returns in a positive way .This in my opinion is due to the pride the shareholders feel when a company they own a piece of buy another company. In my opinion firm’s performance is based on initial investor exuberance that wins and the drop in share price after is probably due to expenses in restructuring the company. My overall assessment of this is that it is well done.

Dean Xu, Changui Zhou & Philip H. Pan (2010). Journal of International Business Studies. Academy of International Business, Pg.166-174.

The paper describes the real options based acquisition strategy of Chinese companies and how their choices are influenced by the institutional context. High transaction costs in emergent and developing markets do not give high option growth values. This is based on international comparisons. The authors do a good job in addressing the exogenous and endogenous uncertainty. In my evaluation it surmise’s that it is unaffected by the firms actions. The conceptualization of sequential acquisition is as a result of the business environment they operate. In my opinion it is an informational and learning mechanism. It is also used to acquire patents they would otherwise not have access to. The paper fails to mention this. I do not agree with the paper in only one respect. I believe the Strategy used by Chinese firms is a hedging strategy as well. All in all it is a very good paper well researched.

References

Huang Jiayin (2010). The effects of mergers and acquisitions and the effects on China Proquest dissertation and theses (PQDT) pg. n/a

Dean Xu, Changui Zhou & Philip H. Pan (2010). Journal of International Business Studies. Academy of International Business, Pg.166-174.