气候变化领域集成服务门户(CCPortal): Does cheap electricity in a target's location add value to the acquirer? Evidence from China

CCPortal

DOI	10.1016/j.enpol.2020.111700
	Does cheap electricity in a target's location add value to the acquirer? Evidence from China
	Li M.; Liu C.; Shen C.
发表日期	2020
ISSN	03014215
卷号	145
英文摘要	Domestic cross-region mergers and acquisitions (M&A) are a popular corporate investment behavior. Merger and acquisition activity can have a great impact on the value of both firms involved in the transaction; market investors will buy and sell shares of the target and acquiring firms involved in M&A activity as a way to express whether they are optimistic about the success of the transaction. By analyzing the electricity price differences between targets' and acquirers' locations in nonlocal M&A activity in China from 2010 to 2017, and applying Fama-French three-factor and five-factor models, we find that many M&A transactions use the comparative advantages of lower electricity prices in the target's location, and market investors highly value M&A transactions driven by electricity price differences. The value placed by investors on these transactions is higher still when both the acquirer and the target are high electricity-intensive firms. Our work is among the first to rigorously analyze domestic cross-region M&A activity from the perspective of differential electricity prices between the targets' and acquirers' locations. We provide policy implications on how a less developed area with rich and cheap energy resources could use comparative advantages to promote economic development and boom the power market by M&A. © 2020 Elsevier Ltd
关键词	Acquirer's value Electricity price Market investor response Mergers and acquisitions
英文关键词	Commerce; Costs; Energy resources; Investments; Location; Public policy; Comparative advantage; Corporate investments; Electricity prices; Five-Factor Model; Nonlocal; Policy implications; Mergers and acquisitions; comparative advantage; economic development; electricity industry; electricity supply; energy market; energy policy; industrial investment; merger; price determination; China
语种	英语
来源期刊	Energy Policy
文献类型	期刊论文
条目标识符	http://gcip.llas.ac.cn/handle/2XKMVOVA/204742
作者单位	Faculty of Economics and Management, East China Normal University, Shanghai, 200062, China; Shanghai M&A Financial Research Institute ECNU, Shanghai, 200062, China; Institute of Financial Science and Technology ECNU, Shanghai, 200062, China; School of Finance, Shanghai University of Finance and Economics, Shanghai, 200246, China
推荐引用方式 GB/T 7714	Li M.,Liu C.,Shen C.. Does cheap electricity in a target's location add value to the acquirer? Evidence from China[J],2020,145.
APA	Li M.,Liu C.,&Shen C..(2020).Does cheap electricity in a target's location add value to the acquirer? Evidence from China.Energy Policy,145.
MLA	Li M.,et al."Does cheap electricity in a target's location add value to the acquirer? Evidence from China".Energy Policy 145(2020).