John J. García

Effects of Mergers and Acquisitions on Shareholder Wealth: Event Study for Latin American Airlines

This study analyzes the effect of changes in corporate control on the way shareholders benefit from the announcements of selling and buying airlines, thus contributing to the literature on mergers and acquisitions (M&As) in emerging markets. Using a methodology of event study, including GARCH and OLS models, we find evidence that some selling companies obtain abnormal returns that are statistically significant after the announcement of the M&A. However, when the merger is not strategic, the companies present statistically significant negative abnormal returns. The results are not conclusive when analyzing the effect on the value of the buying companies.

Regulatory reform and corporate control in European energy industries

The deregulation process in the EU electricity sector triggered strategic decisions that led to industry restructuring. This paper presents preliminary evidence of the impact of this process on investors, using event studies and estimation techniques such as least squares and GARCH. Our findings suggest three stylized facts: 1) regulatory reform in Europe was certainly accompanied by a takeover wave, as predicted by Mitchell and Mulherin (1996); 2) mergers and acquisitions had a positive impact on the stock price of target firms, and a much lower and sometimes even a negative impact for the bidding firms; 3) the effect of takeover announcements on the returns of competitors of the merging firms depends on the degree of market power. In countries with high market power (like Spain) competitors significantly increase share returns upon takeover announcements, whereas in countries with lower market power (like England and Wales) returns do not change significantly.

Spatial effects in the bid price setting strategies of the wholesale electricity markets: The case of Colombia

Weather conditions in Colombia vary greatly throughout the territory and therefore the location of electricity generating plants plays a key role in their bid pricing strategies. To account for these location-specific pricing strategies this paper estimates a Spatial Durbin Model (SDM) with monthly data gathered from the 17th largest hydraulic electricity generating plants of Colombia on bid prices, generation, energy inputs and positive reconciliation over the period January 2005-August 2015 and controlling also for the system marginal prices and the economy cycle. The paper reports three main results. First, firms ? bid prices are negatively affected by the energy inputs of the rivals, second they are unaffected by positive reconciliation payments to the rivals and third they are negatively affected by the generation amounts of the rivals. One potential policy recommendation of these results is the need to implement balancing markets to signal more efficiently the pricing strategies in these markets.

Demanda de Internet: El sector mayorista de telecomu- nicaciones Colombiano (Internet Demand: The Colombian Telecommunications Sector Wholesaler)

Spanish Abstract: A raiz de la necesidad de conocer las diferentes variables que inciden en los servicios de transporte de datos, la escasez de art iculos academicos que describan el comportamiento de la demanda en el sector mayorista y tomando como referencia los trabajos realizados, tanto por Madden & Coble-Neal (2004) como por Karacuka, Haucap & Heimeshoff (2011), se presenta, tanto un modelo de demanda, como un modelo de formacion de precios, estimados a traves de tecnicas de panel de datos a nivel de firmas, con el objetivo de comprender el comportamiento de estas en el mercado Colombiano y cuyos resultados fundamentales son una elasticidad precio de la demanda de 1.1102, una elasticidad inversa de la demanda de 0.2215 y una elasticidad ingreso de 0.0569, para las firmas proveedoras del servicio de internet a usuarios finales.English Abstract: Following the need to know the different variables that affect the data transport services, the shortage of academic papers that describe the behavior of the demand in the telecommunications wholesalers market and taking as a reference the work done by Madden & CobleNeal (2004) and Karacuka, Haucap & Heimeshoff (2011), it’s presented both a demand model, as well as a price formation model, estimated trough firms-level panel data techniques, aiming to understand the behavior of those firms in the Colombian market and which main results are a demands price elasticity of 1.1102, an inverse price elasticity of 0.2215 and finally an income elasticity of 0.0569, for the firms providing the services to final client.

Internationalization Strategies to Replicate in Design and Consulting Engineering Services Firms Related to the Energy Industry

ABSTRACT Based on a case study of a Colombian company, HMV Ingenieros Ltda, this article aims to analyze different strategies for expanding consulting and design engineering firms related to the energy industry. Variables taken from internationalization theories, such as the Eclectic paradigm, the Uppsala model, and the five competitive forces, are considered in a longitudinal case study to determine the industry best practices for consulting and design engineering firms. As the focus on these services is relatively new in internationalization and competitiveness studies, this study is believed to be of great interest for research purposes.

European Energy Industry Shocks, Corporate Control and Firms' Value

The deregulation process in the EU electricity sector triggered strategic decisions that led to industry restructuring. This paper presents preliminary evidence of the impact of this process on investors, using event studies and estimation techniques such as least squares and GARCH. Our findings suggest three stylized facts: 1) regulatory reform in Europe was certainly accompanied by a takeover wave, as predicted by Mitchell and Mulherin (1996); 2) mergers and acquisitions had a positive impact on the stock price of target firms, and a much lower and sometimes even a negative impact for the bidding firms; 3) the effect of takeover announcements on the returns of competitors of the merging firms depends on the degree of market power. In countries with high market power (like Spain) competitors significantly increase share returns upon takeover announcements, whereas in countries with lower market power (like England and Wales) returns do not change significantly.

An Internationalization Model to Enter the Northern Triangle Market

An internationalization model is proposed for a Colombian company specialized in design and consulting engineering services related to the energy sector. The study of these services is relatively new in internationalization and competitiveness, therefore of great interest for research purposes. The model is created with the purpose of conquering the Northern Triangle market (Guatemala, Honduras, El Salvador). Different internationalization theories, such as the Eclectic Paradigm, the Uppsala Model and the Five Competitive Forces were considered. Different assessments were carried out based on qualitative and quantitative data through the case study method in which analyses were performed to generate and evaluate the main variables in the model. Outcomes assure that, HMV Ingenieros Ltda (a Colombian company) is prepared to start commercial presence in the Northern Triangle considering the Step-by-Step model as the way to reach the studied market. In addition, analysis of macroeconomic trends finds Guatemala as the best potential market.