Assessment of financial results of mergers and acquisitions: analysis on the example of a deal between China and Kazakhstan

Abstract

Cross-border mergers and acquisitions (M&As) are a crucial tool for implementing international economic strategies, particularly within the framework of the "One Belt, One Road" initiative. This study aims to comprehensively assess the financial outcomes of such transactions, using the strategic partnership between China and Kazakhstan in the oil and gas industry as an example. The relevance of this work stems from the need to analyze the actual consequences of significant foreign investments on the national economy and participating companies. Instead of testing general hypotheses, this article employs a case study methodology to deeply analyze a specific M&A transaction. We examine both the short-term market reaction to the announcement of the deal and the long-term changes in the operating and financial performance of the Kazakh company following the entry of the Chinese investor. The results of the analysis suggest that, despite a subdued or neutral response from the buyer's stock market in the short term, long-term financial outcomes for the acquired company could be significantly improved through the influx of investment, introduction of new technologies, and optimization of production processes. The study demonstrates that success in cross-border mergers and acquisitions depends less on speculative market expectations and more on the investor's long-term strategic commitment.