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1. Introduction
Mergers and acquisitions (M&As) are drivers of inorganic growth (Song et al., 2013) and means of accomplishing strategic and financial objectives (Ermolaeva, 2019). M&As lead to reallocation of assets and a potential synergy gain (Tanna and Yousef, 2019). M&As can be classified into domestic, inbound cross-border and outbound cross-border, depending upon the headquarters of the acquirer and target companies. A domestic M&A (DMA) involves firms with the same country as both acquirer and target, whereas a cross-border M&A (CBMA) involves a target and acquirer from two different nationalities. A CBMA is of two types: inbound and outbound cross-border M&A. An inbound cross-border M&A (ICBMA) involves a foreign acquirer and domestic target. In contrast, an outbound cross-border M&A (OCBMA) consists of a foreign country target (Zhou et al., 2016). Inbound M&As provide an inflow of foreign funds into the economy, whereas outbound M&As involve the outflow of domestic funds. The different types of M&As can be utilized to gain access to markets and resources.
Academic works on M&As are classified depending on various contexts, and headquarters' location is one of them. Studies document cross-border and domestic M&A activity being affected by various factors. The factors include industry concentration/regulation, the experience of acquirer/advisors, payment method and so on (Muehlfeld et al., 2012; Reddy et al., 2016; Zhou et al., 2016). The M&A activity involving a particular country are a result of the decisions of businesses and policymakers. The level of M&A activity can easily be assessed from the number of deals and the combined monetary value of deals taking place in an economy. Earlier, domestic and cross-border M&As were limited to Western and other developed countries; however, since the 1990s, the numbers of M&As involving emerging countries have seen a noticeable rise (Li et al., 2019). The spur in the number of domestic and cross-border M&As initiated is due to deregulation and privatization in many countries. Firms choose between domestic and foreign investments, and most studies maintain a conceptual difference between domestic and cross-border M&As. However, with increasing globalization, domestic mergers are impacted by cross-border dimensions (Reynolds and Teerikangas, 2016). The rise of multinational enterprises has led to a significant rise in OCBMAs from emerging economies, leading to the...