This paper deals with acquisitions from emerging to advanced countries and the performances of target firms. Descriptive statistics is employed to investigate the strategies and the impact of the entry of Emerging Multinational Companies (EMNCs) from Brazil, Russia, India and China (BRIC) on the performance of firms that were acquired in Europe, North America and Japan between 2000 and 2007. Results show that EMNCs not always acquire firms with high pre-acquisition performance and that they do not significantly increase the profitability of target firms after acquisition. Nevertheless, EMNCs contribute to increase target firms’ productivity and sales and to slow down their loss of jobs. We also show the importance of acquisition experience of the acquiring firms. Experienced EMNCs not only acquire firms with higher pre-acquisition performance, but they also contribute to increase more significantly the productivity and sales of the target firms. We finally highlight the differences in the dimensions and in the technology intensity of target firms acquired by experienced and unexperienced EMNCs, in order to provide further insights concerning the strategies and the effects of acquisitions from emerging to advanced countries.
FDI from emerging to advanced countries: some insights on the acquisition strategies and on the performance of target firms
ELIA, STEFANO;
2014-01-01
Abstract
This paper deals with acquisitions from emerging to advanced countries and the performances of target firms. Descriptive statistics is employed to investigate the strategies and the impact of the entry of Emerging Multinational Companies (EMNCs) from Brazil, Russia, India and China (BRIC) on the performance of firms that were acquired in Europe, North America and Japan between 2000 and 2007. Results show that EMNCs not always acquire firms with high pre-acquisition performance and that they do not significantly increase the profitability of target firms after acquisition. Nevertheless, EMNCs contribute to increase target firms’ productivity and sales and to slow down their loss of jobs. We also show the importance of acquisition experience of the acquiring firms. Experienced EMNCs not only acquire firms with higher pre-acquisition performance, but they also contribute to increase more significantly the productivity and sales of the target firms. We finally highlight the differences in the dimensions and in the technology intensity of target firms acquired by experienced and unexperienced EMNCs, in order to provide further insights concerning the strategies and the effects of acquisitions from emerging to advanced countries.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
