Do political ideology and polarization place a discount on M&A premiums?

IF 6.9 2区经济学 Q1 BUSINESS, FINANCE

Finance Research Letters Pub Date : 2025-09-27 DOI:10.1016/j.frl.2025.108575

Victor Barros , Kuan Hon Cheang , Cristina Gaio , Tiago Cruz Gonçalves

引用次数: 0

Abstract

This study investigates whether M&A premiums are influenced during election years by a country’s political ideology, the degree of political polarization, and the presence of closely contested elections. Using a dataset spanning from 2000 to 2022, comprising 1646 announced deals in election years across 29 countries, we find that political ideology significantly affects M&A premiums. Premiums tend to be lower in countries leaning to the right and higher in those left-leaning ones. However, these effects are not driven by political polarization at ideological extremes, by narrowly decided elections, or by the polarization level of the acquirer’s country. Overall, our findings suggest that investors incorporate the political orientation of the target country into their valuation of M&A deals during election years.

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政治意识形态和两极分化会降低并购溢价吗？

本研究考察了在选举年，一国的政治意识形态、政治两极化程度以及竞争激烈的选举是否会影响并购溢价。使用2000年至2022年的数据集，包括29个国家在选举年宣布的1646笔交易，我们发现政治意识形态显著影响并购溢价。在右倾国家，保费往往较低，而在左倾国家，保费则较高。然而，这些影响不是由意识形态极端的政治两极分化、狭隘决定的选举或收购者国家的两极分化程度所驱动的。总体而言，我们的研究结果表明，投资者在选举年将目标国家的政治倾向纳入其并购交易的估值。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Finance Research Letters BUSINESS, FINANCE-

CiteScore

11.10

自引率

14.40%

发文量

863

期刊介绍： Finance Research Letters welcomes submissions across all areas of finance, aiming for rapid publication of significant new findings. The journal particularly encourages papers that provide insight into the replicability of established results, examine the cross-national applicability of previous findings, challenge existing methodologies, or demonstrate methodological contingencies. Papers are invited in the following areas: Actuarial studies Alternative investments Asset Pricing Bankruptcy and liquidation Banks and other Depository Institutions Behavioral and experimental finance Bibliometric and Scientometric studies of finance Capital budgeting and corporate investment Capital markets and accounting Capital structure and payout policy Commodities Contagion, crises and interdependence Corporate governance Credit and fixed income markets and instruments Derivatives Emerging markets Energy Finance and Energy Markets Financial Econometrics Financial History Financial intermediation and money markets Financial markets and marketplaces Financial Mathematics and Econophysics Financial Regulation and Law Forecasting Frontier market studies International Finance Market efficiency, event studies Mergers, acquisitions and the market for corporate control Micro Finance Institutions Microstructure Non-bank Financial Institutions Personal Finance Portfolio choice and investing Real estate finance and investing Risk SME, Family and Entrepreneurial Finance