The Analysis Of Acquirer Firm's Financial Performance Before And After Merger And Acquisition (indonesian Stock Exchange 2003 - 2013)

Abstract

Conducting corporate merger and acquisition is faster and more favorable strategy in order to survive and grow. This research aims to examine the impact of merger and acquisition on financial performance of the firms measured by financial ratios, whether significant differences found before and after merger and acquisition.The sample of this research consists of 11 firms taken by purposive sampling method. The data of financial ratios are obtained from the Indonesian Capital Market Directory (ICMD) from year 2003 to 2013. The data analysis method used to answer the hypotheses is Paired T Test. The synergy is then measured by examining some pre- and post-merger and acquisition financial ratios (5 years before and 5 years after). The result shows that all financial ratios are not significatly different before and after merger and acquisition, meaning merger and acquisition have not yet brought significant impact on the financial performance of the firms. Key words: Mergers and Acquisition, Financial Performance, Synergy