(The Effect of Mergers And Acquisition Activities on Company's Performance: A Research on Istanbul Stock Exchange)

Abstract

Purpose – The aim of this study is to show how the financial performance of the firms that perform merger and acquisition activities as growth strategy is affected by these activities. Design/methodology/approach – In the calculations, no econometric model is used and only the ratio analysis is used. In this research, the effect of the merger and acquisition activities between the years 20013 and 2015 of the firms registered in the İstanbul Stock Exchange on return on assets (ROA), return on equity (ROE), return on sales (ROS), gross profit margin (EKM), growth rate of net sales (NSB) which shows growth rates, equity growth rate (OSB) and asset growth rates (AB) is analyzed. Findings – A total of 70 ratios were calculated in the company's profitability. İt’s seen that 36 of thm has decreased and 34 of them has increased. İn growth rates, a decrease was observed in 30 of the 42 and an increase in 12 of them. it was observed that two of the merger / acquitions types of firms were mixed, and horizontal merger / acquitions was preferred in the twelfth. At the same time, it is observed that the firms prefer to acquire target firms that are from the same country. Discussion – The results show that, unlike expectations, mergers and acquisitions do not always result in an increase in the profitability of firms. it should be investigated that firms that do not increase their profitability perform mergers / acquisitions in order to increase their borrowing rate or not. Discussion – While all these processes are classified and appropriate solution proposals are produced, it is necessary that the classifications of complaints, suggestions and thanks (ISQA) should be transferred correctly and that the banks are deeply rooted for these first three issues and customers develop convincing solution times; they are expected to provide solutions to prevent or eliminate the problem by designing processes.