Impact of corporate restructuring on the financial performance of the companies

Abstract

The thesis aims to analyse the impact of the Corporate Restructuring (specifically Mergers and Acquisitions) on the financial performance of the Indian Companies. The thesis gathers the data from the secondary sources. It evaluates and analyses a sample of 29 firms over a nine year time frame comprising the four years before and after the M&As using 21 financial ratios spanning Liquidity, profitability, efficiency, solvency, investment, market, and valuation ratios to assess any significant difference. The primary method used is descriptive statistics, and the paired sample t-test is used to identify if there’s any significant change in the merger ratios of the companies. The key findings suggest that the impact of Mergers and Acquisitions isn’t always positive, negative, uniform, but rather un-uniform and mixed, and depends on the company-specifics, deal structure, post-merger integration, long-term impact, and sector specifics. The thesis concludes with the statement that the M&As don’t always guarantee an improvement in the financial performance, and overall, the thesis provides an insight into the understanding of the impact of corporate restructuring’s most prominent approach, the M&As, on the financial performance of the companies in India.