| Project/Area Number |
20K13530
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| Research Category |
Grant-in-Aid for Early-Career Scientists
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| Allocation Type | Multi-year Fund |
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| Review Section |
Basic Section 07060:Money and finance-related
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| Research Institution | Waseda University |
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Principal Investigator |
NGUYEN Duc Giang 早稲田大学, 政治経済学術院, その他(招聘研究員) (70835462)
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| Project Period (FY) |
2020-04-01 – 2024-03-31
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| Project Status |
Completed (Fiscal Year 2023)
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| Budget Amount *help |
¥3,770,000 (Direct Cost: ¥2,900,000、Indirect Cost: ¥870,000)
Fiscal Year 2023: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000)
Fiscal Year 2022: ¥780,000 (Direct Cost: ¥600,000、Indirect Cost: ¥180,000)
Fiscal Year 2021: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000)
Fiscal Year 2020: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000)
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| Keywords | Corporate Finance / Venture Capital / Merger and acquisition / Syndication / Method of Payment / Social Network / Mergers and Acquisitions / venture capital / method of payment / social network / Merger and Acquisition / Premium / Long-term Performance |
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| Outline of Research at the Start |
This research project investigates the decision of Venture Capital firms (VCs) to choose equity or cash proceeds when they exit their investments through mergers and acquisitions. We raise and answer following questions: Do VCs prefer cash or equity when they exit via mergers and acquisitions? How do VCs’ investment preferences affect the decision to hold acquirer shares? Which types of VCs prefer stock offers? How does the choice of payment by VCs affect the performance of buyers in the short-term and long-term.
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| Outline of Final Research Achievements |
My research proposal focuses on the relationship between venture capital (VC) investors in target firms and the economic outcomes of mergers acquisitions. I show that venture capital (VC)-backed targets prefer stock as the method of payment in mergers and acquisitions, and the ratio of stock is larger when the targets are financed by a syndicate of VCs. Overall, my research reveals the investors' strategies to hold shares of the acquirers that meet their investment preferences.
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| Academic Significance and Societal Importance of the Research Achievements |
My research is the first investigation into the effect of VC investments on transaction terms and economic outcomes of M&As. It reveals the value creation of VC syndication and explains how VC firms' investment strategies in target firms affect the wealth of acquirer shareholders.
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