The determinants of hiring financial advisors in business acquisitions: a multi-study analysis

Abstract

Mergers and acquisitions (M&A) are predominant strategies among CEOs seeking the expertise of financial advisors to add value to transactions. However, the literature on the determinants of this hiring process remains fragmented and presents inconsistencies in results, particularly under theoretical perspectives such as behavioral strategy. This thesis analyzes the determining factors for hiring financial advisors in acquisitions, using an empirical approach based on Upper Echelons Theory. The structure of the thesis consists of three interdependent studies. The first is a systematic literature review (SLR) that analyzes 46 articles using the PRISMA tool, identifies gaps in the research, and proposes an agenda for future investigations. The second study is a meta-analysis of 65 investigations that clarifies the conditions under which the hiring of financial advisors positively impacts acquisition performance, revealing significant moderators such as the reputation of the advisors and the size of the transactions. The third study conducts a quantitative empirical analysis of acquisitions of publicly traded companies between 2012 and 2022, examining the moderating influence of CEOs' experience and tenure on the relationship between acquisition characteristics and the hiring of high-reputation financial advisors. By integrating different empirical approaches, this thesis advances the understanding of the factors determining the hiring of financial advisors in M&A, offering a novel theoretical perspective based on Upper Echelon Theory and significantly contributing to the existing literature.