Determinants | Interdependency | Theoretical background |
DAX and M&A activity | + | Exogenous and endogenous determining factors: · Positive expectations for the future · Increasing cash flows · High liquidity · Favorable credit terms |
Capital market theory’s approach: · Inefficient capital market · Assumption that managers behave rationally · Relative overvaluation of the purchasing companies · Overvaluation of synergies | ||
Industrial economic-strategic approach: · “Herd behavior” · M&A activity is the sequential-rational result of a series of M&A decisions · Assumption of future possibilities for value enhancement | ||
Neoclassical approach: · Real option model · Game theory |