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Contribution Details
| Type | Master's Thesis |
| Scope | Discipline-based scholarship |
| Title | A Markovian Policy on Optimal Timing of Staged Technology Acquisitions |
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| Institution | University of Zurich |
| Faculty | Faculty of Business, Economics and Informatics |
| Number of Pages | 66 |
| Date | 2019 |
| Abstract Text | This study explores the impact of exercise timing of buyout real options on the acquirer’s shareholder value when announcing to extend its commitment in a high-technology target. Buyout real options arise when purchasing a minority stake in a target and are exercised when extending the investment into a controlling interest. Markov decision processes applied to identify optimal exercise decisions indicate that when acquiring a public target, there is an economically and statistically significant positive association between optimal exercise timing and the cumulative abnormal announcement return to the acquiring firm. No such conclusion can be drawn for acquirers seeking to enter new high-technology industries. |
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