Healthcare M&A success: an event study on key value drivers

Abstract

This thesis aims to identify value creation for all participants in M&A deals in the healthcare industry between 1981 and 2021. On average, M&A transactions in the healthcare industry lead to positive abnormal returns for target firms shareholders and for the combined entities. Furthermore, we analyse the key drivers. For targets’ shareholders, we find positive significant impact in the acquiring company size (market capitalisation) and in the target R&D intensity (as a percentage of target enterprise value). For the hypothetical combined entity, we observe a positive significant impact in the deal size (as a percentage of acquirer enterprise value).