The importance of targets and value creation in vertical acquisitions

Manapol Ekkayokkaya, Krishna Paudyal

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)
19 Downloads (Pure)


We study how value creation in vertical acquisitions varies in the importance of the target’s assets to its acquirer. The synergistic gain increases in the degree of vertical relatedness between the acquirer and target industries. This finding suggests that the importance of the target firm’s assets to its acquirer’s productivity is an important value-creating channel in vertical acquisitions. We also find evidence suggesting that acquirers extract greater value as the synergistic gain increases, consistent with an efficient investment incentive underlying the integration decision.
Original languageEnglish
Pages (from-to)636-644
Number of pages9
JournalInternational Review of Finance
Issue number2
Early online date20 Aug 2019
Publication statusPublished - 30 Jun 2021


  • synergy
  • vertical aquisitions
  • vertical integration
  • vertical relatedness


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