The Effects of International Mergers and Acquisitions on Innova tive Financial Performance for the Higher Education Industry

Abstract

Research indicates that 45% t
o 75% of mergers throughout all in
dustrial sectors fail. The
literature indicates i
ncreasing rates for hi
gher education inst
itution (HEIs) mergers. Researchers
do not share common definitions of success for HEI mergers. One
common and generally
accepted definition for HEI succe
ss does exist through world cl
ass university ranking
organizations lists of top HEIs
. This study utilized WCU rankin
g criteria and found that HEIs are
ranked based upon research strength, teaching quality, and glob
al outlook to determine HEI
rankings. This study adapted repre
sentative metrics used by the
se ranking organizations which
served as the DVs in this study. T
he study adopted the Event St
udy theoretical framework to
serve as the lens to evaluate
the data and utilized a quantitat
ive methodology with a causal-
comparative research design. Data was obtained from the IPEDS d
atabase. The study utilized
time as the within-subjects IV
represented by Period 1 and Peri
od 2 measures beginning the year
of merger and 5 years subsequent t
o the merger. The between-sub
jects IV was merger status. The
study sample included 80 HEI
s which merged between 1988 - 2013
and 80 matching pair non-
merging HEIs. The study used a two-way mixed design ANOVA to an
swer the following three
research questions: “Are there i
nteraction effects between time
and merger status upon the DVs
of revenues, fall en
rollment rates, and nonr
esident alien rates
?” The study found no statistically
significant main effects between
time and merger status upon re
venues and nonresident alien
rates and a statistically si
gnificant effect upon fall enrollme
nt rates.