A Study on Consolidations in Indian Hotel Industry

Abstract

Mergers and acquisitions around the world are now, not in favour of traditional viewpoint, that is, the power of linked up, reduced cost and enlarged scale of operations. M&A deals by the corporates around the world getting momentum to become bigger in size. All the sectors are participating in this move by having domestic and cross-boarder M&As. Indian hotel industry is also found aggressive in this move. So, it becomes imperative to know either they are serious towards value acquisitions or it is merely an image building process. In this context, the present study is based upon the performance appraisal of acquirer companies from this sector. The study is limited up to the five domestic mergers only, that have been took place from 1998-2008. It examines the financial performance of acquirer companies during the post-merger period by comparing it with pre-merger financial performance. Financial performance analysis has been conducted by considering the aspect of liquidity, profitability and solvency.