Value Creation or Destruction? Evaluating M&A Outcomes in Pakistan’s Financial and Non-Financial Sectors

Authors

  • Dr. Muhammad Mahmood Shah Khan Assistant Professor Department of Banking and Finance Hasan Murad School of Management
  • Dr. Talat Hussain Associate Professor Department of Islamic Thought and Civilization School of Social Sciences and Humanities
  • Ujala Aftab Wyne Lecturer Department of Banking and Finance Hasan Murad School of Management
  • Dr. Sahibzada Muhammad Waseem Jan Assistant Professor, Department of Business Administration, IBA Sukkur
  • Muhammad Irfan* Assistant Professor Sarhad University of Science and Information Technology, Peshawar

DOI:

https://doi.org/10.63075/s6adcd02

Abstract

This study investigates the impact of mergers and acquisitions (M&As) on the performance of firms listed on the Pakistan Stock Exchange. A sample of 13 companies, engaged in M&A activities between 2009 and 2020, was analyzed. The study covers a four-year window—two years before and two years after each merger or acquisition. Firm performance was evaluated using three key indicators: Modified Value Added Intellectual Coefficient (MVAIC), Return on Investment (ROI), and Net Profit Margin (NPM). Simple ratio analysis was employed to compare pre- and post-M&A performance. The findings reveal a decline in ROI and NPM following M&A events, whereas MVAIC showed a positive trend, suggesting an improvement in intellectual capital efficiency post-merger. These results highlight a mixed impact of M&As on firm performance in the Pakistani context.

Keywords- Value Creation or Destruction, Evaluating M&A, Pakistan’s Financial and Non-Financial Sectors

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Published

2025-04-25

Issue

Vol. 2 No. 2 (2025): Journal of Management & Social Science

Section

Articles

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How to Cite

Value Creation or Destruction? Evaluating M&A Outcomes in Pakistan’s Financial and Non-Financial Sectors. (2025). Journal of Management & Social Science, 2(2), 690-704. https://doi.org/10.63075/s6adcd02