To build or buy? : the asset growth effect on organic and inorganic growth.

How will companies benefit from organic growth versus undertaking merger and acquisitions? This question is largely unanswered in the organizational growth literature. This paper studied the effect of undertaking both approaches on the stock performance of US firms. We tested for firm-level asset in...

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Main Authors: Chow, Jerome Ken Wen., Fong, Poh Loong., Ng, Jun Zhe.
Other Authors: Angie Low An Chee
Format: Final Year Project
Language:English
Published: 2012
Subjects:
Online Access:http://hdl.handle.net/10356/48322
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Institution: Nanyang Technological University
Language: English
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spelling sg-ntu-dr.10356-483222023-05-19T07:23:08Z To build or buy? : the asset growth effect on organic and inorganic growth. Chow, Jerome Ken Wen. Fong, Poh Loong. Ng, Jun Zhe. Angie Low An Chee Nanyang Business School DRNTU::Business::Finance::Mergers and acquisitions How will companies benefit from organic growth versus undertaking merger and acquisitions? This question is largely unanswered in the organizational growth literature. This paper studied the effect of undertaking both approaches on the stock performance of US firms. We tested for firm-level asset investment effects in returns by examining cross-sectional relations between an interaction variable, Merger Dummy x Asset Growth, and subsequent stock returns. We found that inorganic growth will result in lower stock returns as compared to organic growth. The implication of this study on the ‘build or buy’ decision suggests that an organic approach will result in less severe short-term negative returns relative to an acquisition. BUSINESS 2012-04-05T01:00:52Z 2012-04-05T01:00:52Z 2012 2012 Final Year Project (FYP) http://hdl.handle.net/10356/48322 en Nanyang Technological University 31 p. application/pdf
institution Nanyang Technological University
building NTU Library
continent Asia
country Singapore
Singapore
content_provider NTU Library
collection DR-NTU
language English
topic DRNTU::Business::Finance::Mergers and acquisitions
spellingShingle DRNTU::Business::Finance::Mergers and acquisitions
Chow, Jerome Ken Wen.
Fong, Poh Loong.
Ng, Jun Zhe.
To build or buy? : the asset growth effect on organic and inorganic growth.
description How will companies benefit from organic growth versus undertaking merger and acquisitions? This question is largely unanswered in the organizational growth literature. This paper studied the effect of undertaking both approaches on the stock performance of US firms. We tested for firm-level asset investment effects in returns by examining cross-sectional relations between an interaction variable, Merger Dummy x Asset Growth, and subsequent stock returns. We found that inorganic growth will result in lower stock returns as compared to organic growth. The implication of this study on the ‘build or buy’ decision suggests that an organic approach will result in less severe short-term negative returns relative to an acquisition.
author2 Angie Low An Chee
author_facet Angie Low An Chee
Chow, Jerome Ken Wen.
Fong, Poh Loong.
Ng, Jun Zhe.
format Final Year Project
author Chow, Jerome Ken Wen.
Fong, Poh Loong.
Ng, Jun Zhe.
author_sort Chow, Jerome Ken Wen.
title To build or buy? : the asset growth effect on organic and inorganic growth.
title_short To build or buy? : the asset growth effect on organic and inorganic growth.
title_full To build or buy? : the asset growth effect on organic and inorganic growth.
title_fullStr To build or buy? : the asset growth effect on organic and inorganic growth.
title_full_unstemmed To build or buy? : the asset growth effect on organic and inorganic growth.
title_sort to build or buy? : the asset growth effect on organic and inorganic growth.
publishDate 2012
url http://hdl.handle.net/10356/48322
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