Economic policy uncertainty and cross-border mergers and acquisitions

Andros Gregoriou, Binh Duy Nguyen, Tung Duy Nguyen, Huong Le, Robert Hudson

Research output: Contribution to journalArticlepeer-review


We examine the impact of policy uncertainty on cross-border mergers and acquisitions (M&As). Using a sample of 23 countries worldwide over the period from 2003 to 2016, we provide evidence that when a country has high policy uncertainty, the volume of inbound acquisition decreases whereas the total number of outbound deals increase significantly. Policy uncertainty also encourages acquirers to use stock as a method of payment and offer lower premium to targets. We also find that the percentage of full control cross-border M&A deals is negatively correlated to the level of policy uncertainty. Further evidence suggests that policy uncertainty complicates the takeover process by increasing the probability of withdrawn and pending deals as well as requiring longer time periods to complete deals.
Original languageEnglish
Article number101911
JournalInternational Review of Financial Analysis
Publication statusPublished - 24 Sept 2021


  • Cross-border mergers and acquisitions
  • Economic policy uncertainty


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