This paper studies the relationship between Mergers and Acquisitions (M&As) from emerging to advanced countries and the performances of target firms. An extension of the Resources Based View and Dynamic Capabilities approach is adopted to state that the performance of target firm depends not only on its own resources but also on those of the acquiring company. Furthermore, the role of intra-firm network resources and experience, which arise from previous investments undertaken by the acquiring company, is also considered. An empirical analysis is employed to investigate the impact of the resources and intra-firm network resources and experience of Emerging Multinational Companies (EMNCs) from Brazil, Russia, India and China (BRIC) on the performance of firms that have been acquired in Europe, North America and Japan between 2000 and 2007. The results of the GMM analysis show that EMNC’s resources have a positive effect on target firms’ profitability and labor productivity, while the impact on its sales and employment are not significant and negative, respectively. Conversely, EMNCs’ intra-firm network resources and experiences, especially when accumulated through previous M&As in advanced economies and in the BRIC home country, positively affect all the performance measures but employment, which still reports a negative sign.

How emerging multinational companies affect target firms in advanced countries?”

ELIA, STEFANO;
2010-01-01

Abstract

This paper studies the relationship between Mergers and Acquisitions (M&As) from emerging to advanced countries and the performances of target firms. An extension of the Resources Based View and Dynamic Capabilities approach is adopted to state that the performance of target firm depends not only on its own resources but also on those of the acquiring company. Furthermore, the role of intra-firm network resources and experience, which arise from previous investments undertaken by the acquiring company, is also considered. An empirical analysis is employed to investigate the impact of the resources and intra-firm network resources and experience of Emerging Multinational Companies (EMNCs) from Brazil, Russia, India and China (BRIC) on the performance of firms that have been acquired in Europe, North America and Japan between 2000 and 2007. The results of the GMM analysis show that EMNC’s resources have a positive effect on target firms’ profitability and labor productivity, while the impact on its sales and employment are not significant and negative, respectively. Conversely, EMNCs’ intra-firm network resources and experiences, especially when accumulated through previous M&As in advanced economies and in the BRIC home country, positively affect all the performance measures but employment, which still reports a negative sign.
2010
36th EIBA (European International Business Academy) annual conference - IB’S Role in Building a Better and Stronger Global Economy
Mergers and Acquisitions from emerging to advanced countries; Emerging Multinational Companies; Performances of Target Firms; Resources; Intra-firm network Resources and Experience
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11311/581132
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