In this study I examine the relationship between additional investment and financial characteristics for M & A companies’ future performance. In other words, I conduct empirical analysis to clarify the determinants of future performance of companies that have recorded goodwill. I find that the amount of cash at the end of the current period affects the efficiency of additional investment in the following year. For example, when companies with a relatively large amount of cash make relatively large additional investments, they make relatively efficient investments. In addition, even when companies with a relatively large amount of cash make relatively small additional investments, they make relatively efficient investments. When companies with a small amount of cash make relatively large additional investments, they make relatively efficient investments. When very small additional investments are made, efficient investment is not made regardless of the amount of cash.
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