ABSTRACT
This research examines the impact of green mergers and acquisitions (GMA) on the company’s performance (return on asset). This research tested the sample of mergers and acquisitions of firms using OLS regression and a comparative test with t-statistics. The green factor had a statistically positive and significant effect with ROA changes after three years of mergers and acquisitions. In both green and non-green sub-samples, the average ΔROA (T+3) has a minus value in three years after mergers and acquisitions. However, the green sample has a better average ΔROA (T+3) value, close to zero. These results indicate that green deals, despite the higher cost of green mergers and acquisitions (green premium), are expected to improve bidder companies’ financial performance in the future. This research investigated the opportunities for an environmentally friendly transition to a green economy by increasing energy efficiency and renewable energy.
