Comparison of financial performance and firm value before and after mergers and acquisitions of non-financial companies in Indonesia

Abstract

This study was conducted to see whether there is a difference between mergers and acquisitions on financial performance and firm value or not. A total of 31 companies conducting mergers and acquisitions in 2016-2018 listed on the Indonesia Stock Exchange were sampled in this study. The occurrence of decline in profitability, liquidity, activity ratios and firm value as well as an increase in solvency ratios after mergers and acquisitions became the impetus for conducting research. The measuring tool of profitability is Net Profit Margin (NPM). The measuring tool of liquidity is the Current Ratio (CR). The measuring tool of Solvency is the Debt-to-Equity Ratio (DER). The measuring tool for the activity ratio is Total Asset Turnover Ratio (TATO). And the instrument for measuring the value of the company is the stock price. This study used the Wilcoxon-Signed Rank Test to test the hypothesis. The results showed that there was a difference in the Current Ratio (CR) after the merger and acquisition. However, mergers and acquisitions make no difference in Net Profit Margin (NPM), Total Asset Ratio (TATO), Debt-to-Equity Ratio (DER), and Firm value.

Keywords: {'name': 'Mergers and Acquisitions, Financial Performance, Firm Value'}

Authors & affiliations

Jubaedah Nawir
Affiliation not supplied

Kevin Christoper
Affiliation not supplied

Himawan Rahardika
Affiliation not supplied

Rida Anisa Permata
Affiliation not supplied

Helena Olivia Yosih N
Affiliation not supplied

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