The merger and acquisition (M&A) market, characterized by the number of transactions and value of transactions, is also a barometer of the attractiveness of the national economy for foreign capital but also for the domestic market to develop its business. Over the last few years, on a worldwide level, foreign investments have become predominantly M&A transactions, rather than green field investment. The objective of this article is to analyze the financial performance of Romanian companies that have gone through an M&A transaction before and after this type of transaction. The purpose of the research is to see if the financial performance of the companies under review has improved as a result of this M&A transaction. Although the value of M&A transactions is estimated at $5 trillion in 2015, representing 12% of GDP, according to J.P. Morgan statistics (J.P. Morgan, 2016), however, studies show high rates of failure of these transactions. Favorable impact has been identified in the case of hostile takeovers and unrelated takeovers; gains were recorded in the case of the shareholders of the target company who benefited from the cash payment (Wang and Moini 2012). First of all, we should determine what is meant by the financial performance of a company. When can we consider a company to be financially competitive? The performance definition varies depending on the stakeholders’ interests (Gruian 2010), the aspects of performance being multiple. In the present situation, we will consider that a company is financially competitive if it generates profits and generates value for shareholders. The profit ensures the future performance of the company’s business and indicates a low risk of insolvency. The value generated for shareholders keeps the company attractive for current shareholders, but also for potential investors, thus giving them access to their own funding sources. The paper is structured in a logical and gradual way, as follows: the introductory part in which the subject of this paper is mentioned; part II, literature review, containing a presentation of the recent debates on the success and failure rates in M&A transactions; and part III, the analysis of financial performance of mergers and acquisitions in Romania with the methodology used, results, and conclusions.

۲۲٫۲ Literature Review

M&A transactions are based on diverse motivations but always optimistic from the perspective of the transaction’s initiator. G.  Hurduzeu identified the following business motivations: commercial and industrial motivations (obtaining operational synergies, company development, survival, penetration of new markets, increasing market power, and diversification), financial motivations, and special motivations (high-performance management teams, highly qualified specialists, operating licenses) (Hurduzeu 2002).