Drawing upon the eclectic paradigm and the regulative dimension of institutional distance theory, it is posited that to understand a firms’ cross-border merger and acquisition (CBMA) location choices, it is critical to examine the acquirers’ ownership advantages.,Using a sample of CBMAs undertaken by US firms from 1999 to 2015, the paper explores the extent to which acquiring firm ownership advantages – financial and innovation capabilities – influence target firm country selection in relation to regulative distance.,It is shown that acquiring firms with greater innovative capabilities are likely to choose target firms in nations with less regulative distance from their home market; whereas firms with greater financial capabilities target firms in more distant nations.,This paper builds on the important research on CBMA activity, focusing on the largely neglected pre-acquisition resources in relation to the regulative distance between target firms and the acquirer.
Abstract In mergers and acquisitions, the acquiring firm must combine two firms’ resources and capabilities so that the outcome yields value. In individual firms, the marketing & sales, and R&D functions have typically developed intertwined and complex relationships over time. These multifaceted dependencies may obscure the integration of the firms and their functions. In order to reveal to what extent cross-functional relationships determine the success or failure of an acquisitions, we have ma...
Last. Goudarz Azar(Brunel University London)H-Index: 7
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This study examines the extent to which MNEs from developed (DMNEs) and emerging (EMNEs) economies differ in Location behaviour. Studies on MNE location choices have failed to capture the changing FDI landscape and leave the inconsistent findings unexplained. We address this gap by systematically reviewing the extant literature on location choices of DMNEs and EMNEs over the past 36 years – from the introduction of the OLI model to 2016. Key themes emerging from the review reflect a comprehensiv...
Last. David Sarpong(University of the West of England)H-Index: 15
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Purpose Addressing the unique challenge facing emerging-market firms (EMFs) of branding and marketing in their foreign subsidiaries, the purpose of this paper is to evaluate the foreign subsidiary’s corporate visual identity (CVI) transitions during the post-acquisition period. Design/methodology/approach Data on 330 cross-border acquisitions from five emerging markets, namely, Brazil, Russia, India, China and South Africa (BRICS) are used. The cross-sectional multivariate analyses are used to t...
Abstract The aim of this paper is to highlight the importance of the firm’s strategic objectives regarding the choice of countries for foreign expansion, complementing the existing literature on the internationalisation process. Through a multiple case study methodology, we conduct a comparative analysis of three Brazilian ventures that have internationalised in Italy, and three Italian firms that have internationalised in Brazil, seeking to investigate the firms’ decisions on the selection of f...
Purpose The purpose of this study is to explain how factors relating to resource availability affect managerial risk-taking with regard to the geographic and institutional proximity of cross-border merger and acquisition (M&A) targets. The paper further considers the impact of organizational learning by testing the moderating effect of the acquiring firms’ prior international M&A experience. Design/methodology/approach This study uses linear regression with robust standard errors to account for ...
We investigate the role of intellectual property rights protection in cross-border merger and acquisition (M&A) activity. We document a significant increase in inbound cross-border M&As after a country implements reforms that strengthen local intellectual property rights. Importantly, we find that intellectual property rights have an impact on merger activity only in industries that are more intellectual capital-intensive, and when the target country has weaker intellectual property rights prote...
#1Ilaria Galavotti(UCSC: Catholic University of the Sacred Heart)H-Index: 3
#2Daniele Cerrato(UCSC: Catholic University of the Sacred Heart)H-Index: 10
Last. Donatella Depperu(UCSC: Catholic University of the Sacred Heart)H-Index: 8
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Building on organizational learning theory, and notably on the notion of strategic momentum, we examine the antecedents of cross-border acquisitions, with a specific focus on the effect of experience. In particular, we unbundle firm experience into domestic and cross-border acquisition experience. Using data on 763 acquisitions in the period 2007–2013, our results show the existence of a U-shaped relationship between domestic acquisition experience and the likelihood of cross-border acquisitions...
Last. Desislava Dikova(WU: Vienna University of Economics and Business)H-Index: 14
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Firm resources play an important role in explaining the foreign establishment mode choice. However, a theoretical framework that simultaneously a) differentiates between heterogeneous types of resources, b) provides a rationale that consistently explains how firms adapt their establishment mode choice to their resource base, and c) reflects on contextual factors that intervene in the consistency of the direct relationships is largely missing. The present paper draws on the resource-based view (R...
Purpose This paper proposes locational ambidexterity as a location-specific factor based on an operation flexibility perspective, and explores why and how multinational corporations (MNCs) proactively deal with uncertainty by valuing locational ambidexterity in making location decisions. Design/methodology/approach Location choice data for foreign direct investment (FDI) at a sub-national level in China is used to test the role of locational ambidexterity. Findings We find that FDI generally pre...
Last. Jie Liang(Xi'an Jiaotong University)H-Index: 2
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This article, to date, is the first to consolidate, review, and integrate over 250 earlier studies that examine the country-specific determinants of cross-border mergers and acquisitions. Following 6Ws’ systematic review design and protocol, we survey the taxonomy of research published over the past three decades in international business, strategic management, finance, and economics. We present our syntheses in seven strands: macroeconomic and financial markets environment, institutional and re...
This study aims to look at the relationship of external embeddedness and institutional distance (governance aspects) with the foreign subsidiary research and development (RD and institutional distance and subsidiary R&D capacity, such that the relationship is positive in case of the former and negative in case of the latter. The relationship between subsidiary product and process innovation and R&D capacity is positive and stronger at lower levels of institutional distance.,The research ignores ...