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Chapter 14
A New Approach for Suggesting
Takeover Targets Based on
Computational Intelligence and
Information Retrieval Methods:
A Case Study from the Indian
Software Industry
ABSTRACT
In recent years researchers in financial management have shown considerable interest in predicting
future takeover target companies in merger and acquisition (M&A) scenarios. However, most of these
predictions are based upon multiple instances of previous takeovers. Now consider a company that is
at the early stage of its acquisition spree and therefore has only limited data of possibly only a single
previous takeover. Traditional studies on M&A, based upon statistical records of multiple previous
takeovers, may not be suitable for suggesting future takeover targets for this company since the lack of
history data strongly limits the applicability of statistical techniques. The challenge then is to extract
as much knowledge as possible from the single/limited takeover history in order to guide this company
during future takeover selections. Under such an extreme case, the authors present a new algorithmic
approach for suggesting future takeover targets for acquiring companies based on solely one previous
Satyakama Paul
University of Johannesburg, South Africa
Andreas Janecek
University of Vienna, Austria
Fernando Buarque de Lima Neto
University of Pernambuco, Brazil
Tshilidzi Marwala
University of Johannesburg, South Africa
DOI: 10.4018/978-1-4666-4991-0.ch014