Acta Univ. Agric. Silvic. Mendelianae Brun. 2013, 61, 2721-2727
Published online 2013-12-24

Synergic motives and economic success of mergers of Czech companies

Jaroslav Sedláček, Petr Valouch, Alois Konečný

Department of Finance, Masaryk University, Lipová 41a, 602 00 Brno, Czech Republic

One of the motives for mergers and acquisitions is the synergy effect, which can take several forms. This paper tries to find out whether mergers implemented at the Czech market bring positive or negative synergies. The basis of our investigation is the database of the companies that implemented a merger within 2001–2009; out of these, the companies that published their financial statements in a digitalized form were selected. We monitored the development of six indicators characterizing the economic status of a company. The values of these indicators were compared for all participating companies before the merger and for the successor company three years after the merger. The hypotheses were formulated so that they expressed an expectation of a positive synergy brought about by mergers. However, hypothesis testing has not provided a clear result. A positive effect of a merger on the key indicator of net assets, whose growth means an increase in the accounting value of the company after the merger, has been proved for small and medium-sized companies only. The effect of mergers on the increase in indicators has been confirmed for retained earnings from past years and personal costs. Further research will concentrate on the relations between the indicators with the aim to create an integral indicator for the economic success of mergers.


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