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Clean and green, but what does it mean?

Konstenius, Erik LU and Welin, Henning LU (2021) NEKH02 20202
Department of Economics
Abstract
The aim of this paper is to study what role sustainability commitments of the target company have on merger strategies by studying bid premiums determinants between the years 2000 and 2020. The paper uses multivariable regression models that include, among other variables, the degree the target company commits to sustainability and the difference in how much the target and the acquirer commit to sustainability. The paper uses a group of ESG-ratings to evaluate how much a company commits to sustainability. The results show that there exists a statistically significant negative relationship between a target company’s ESG-rating and the bid premium. A higher ESG-rating of the target company appears to result in a lower bid premium. The... (More)
The aim of this paper is to study what role sustainability commitments of the target company have on merger strategies by studying bid premiums determinants between the years 2000 and 2020. The paper uses multivariable regression models that include, among other variables, the degree the target company commits to sustainability and the difference in how much the target and the acquirer commit to sustainability. The paper uses a group of ESG-ratings to evaluate how much a company commits to sustainability. The results show that there exists a statistically significant negative relationship between a target company’s ESG-rating and the bid premium. A higher ESG-rating of the target company appears to result in a lower bid premium. The results also indicate that the difference in how much the target and the acquirer commit to ESG has no significant effect on the bid premium. (Less)
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author
Konstenius, Erik LU and Welin, Henning LU
supervisor
organization
alternative title
An empirical study on the effects of ESG-commitments on bid premiums in mergers and acquisitions
course
NEKH02 20202
year
type
M2 - Bachelor Degree
subject
keywords
Socially responsible investing, ESG-ratings, M&A, merger strategy, multivariate regression
language
English
id
9037859
date added to LUP
2021-03-11 11:45:10
date last changed
2021-03-11 11:45:10
@misc{9037859,
  abstract     = {The aim of this paper is to study what role sustainability commitments of the target company have on merger strategies by studying bid premiums determinants between the years 2000 and 2020. The paper uses multivariable regression models that include, among other variables, the degree the target company commits to sustainability and the difference in how much the target and the acquirer commit to sustainability. The paper uses a group of ESG-ratings to evaluate how much a company commits to sustainability. The results show that there exists a statistically significant negative relationship between a target company’s ESG-rating and the bid premium. A higher ESG-rating of the target company appears to result in a lower bid premium. The results also indicate that the difference in how much the target and the acquirer commit to ESG has no significant effect on the bid premium.},
  author       = {Konstenius, Erik and Welin, Henning},
  keyword      = {Socially responsible investing,ESG-ratings,M&A,merger strategy,multivariate regression},
  language     = {eng},
  note         = {Student Paper},
  title        = {Clean and green, but what does it mean?},
  year         = {2021},
}