The Effect of Managers’ Overconfidence who have Made Mergers and Acquisitions on the Firm Value

Year 2022, Volume: 30 Issue: 54, 101 - 119, 25.10.2022

Reyhan Can , Hatice Işın Dizdarlar

https://doi.org/10.17233/sosyoekonomi.2022.04.05

Abstract

This study aims to examine the effect of overconfidence behaviours of the managers of the companies whose stocks are traded in Borsa Istanbul on the firm value. In the study, a model was created for Tobin q (Model 1), stock market value (Model 2) and enterprise value (Model 3). As a result of the study, a negative relationship was determined between the change in firm value and the overconfidence variable. According to this result, if the managers performing mergers and acquisitions are overconfident, the incorrect decision may be made while determining the firm value. This leads to a decrease in the wealth of the shareholders. In this respect, managers' overconfidence should also be considered while performing mergers and acquisitions in firms.

Keywords

Behavioural Finance, Manager’s Overconfidence, Merger and Acquisition, Firm Value

Birleşme ve Satın Alma Gerçekleştiren Firma Yöneticilerinin Aşırı Güven Davranışlarının Firma Değeri Üzerine Etkisi

Abstract

Bu çalışmanın amacı, Borsa İstanbul’da hisse senetleri işlem gören firmalarda birleşme ve satın alma gerçekleştiren firma yöneticilerinin aşırı güven davranışlarının firma değeri üzerine etkisini incelemektir. Çalışmada, Tobin q (Model 1), borsa değeri (Model 2) ve girişim değeri (Model 3) için model oluşturulmuştur. Çalışmanın sonucunda firma değerindeki değişim ile aşırı güven değişkeni arasında negatif yönlü ilişki tespit edilmiştir. Bu sonuca göre birleşme ve satın alma gerçekleştiren yöneticilerde aşırı güvenin varlığı söz konusu ise firma değeri belirlenirken hatalı karar verilebilir. Bu durum, hissedarların servetinde azalmaya yol açar. Bu açıdan şirketlerin birleşme ve satın alma kararları yöneticilerin aşırı güvenleri de dikkate alınarak değerlendirilmelidir.

Keywords

Davranışsal Finans, Yönetici Aşırı Güveni, Birleşme ve Satın Alma, Firma Değeri

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