This study estimated a logistic model for predicting takeover targets in the gaming industry. The stepwise procedure selected six variables representing size, managerial efficiency, leverage, and liquidity for the model. The model predicts that large, under-leveraged and highly liquid gaming firms with good operating efficiency but low bottom-line profitability are likely to be takeover targets. The model reveals that gaming companies are engaged in mergers and acquisitions in pursuit of not only operating synergy through economies of scale and increased market shares but also financial synergy via tapping unused debt capacity and lowering debt costs. Improved financing efficiency may help raise the overall efficiency after the acquisition.
No takes yet. Share an insight, caveat, or question.
Gu et al. (2001) studied this question.
Synapse has enriched 5 closely related papers on similar clinical questions. Consider them for comparative context: