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The Value Creation of Intellectual Property in Mergers and Acquisitions

Wallertoft, Mark LU and Stenholm, Philip LU (2016) NEKP03 20161
Department of Economics
Abstract
This thesis examines the shareholder value creation of IP in M&A. Using a unique patent-M&A data set over the period 2006 to 2016, we show that acquirers of companies holding IP gain significantly more shareholder value than acquirers of targets not holding IP. We find that this only holds as a binary relationship, and that the discrete relationship between shareholder value and IP is negative. We also find that potential IP synergies do not increase shareholder value. We conclude that, while IP is a vital part of targets' assets in M&A activities, ambitious valuations and large IP premia may shift future IP-induced value from acquirers to targets.
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author
Wallertoft, Mark LU and Stenholm, Philip LU
supervisor
organization
course
NEKP03 20161
year
type
H2 - Master's Degree (Two Years)
subject
keywords
intellectual property, mergers and acquisitions, patents, value creation
language
English
id
8878762
date added to LUP
2016-06-13 13:13:33
date last changed
2016-06-13 13:13:33
@misc{8878762,
  abstract     = {This thesis examines the shareholder value creation of IP in M&A. Using a unique patent-M&A data set over the period 2006 to 2016, we show that acquirers of companies holding IP gain significantly more shareholder value than acquirers of targets not holding IP. We find that this only holds as a binary relationship, and that the discrete relationship between shareholder value and IP is negative. We also find that potential IP synergies do not increase shareholder value. We conclude that, while IP is a vital part of targets' assets in M&A activities, ambitious valuations and large IP premia may shift future IP-induced value from acquirers to targets.},
  author       = {Wallertoft, Mark and Stenholm, Philip},
  keyword      = {intellectual property,mergers and acquisitions,patents,value creation},
  language     = {eng},
  note         = {Student Paper},
  title        = {The Value Creation of Intellectual Property in Mergers and Acquisitions},
  year         = {2016},
}