Theoretical foundations of cross-border mergers and acquisitions: A review of current research and recommendations for the future

Journal of International Management

Volumn 10, Issue 3, 2004, Pages 307-353

  Shimizu, Katsuhiko ^a   Hitt, Michael A ^b   Vaidyanath, Deepa ^c   Pisano, Vincenzo ^d  

^a UNIVERSITY OF TEXAS AT SAN ANTONIO   (United States)

^b TEXAS A AND M UNIVERSITY   (United States)

^c ARIZONA STATE UNIVERSITY   (United States)

^d UNIVERSITY OF CATANIA   (Italy)

Author keywords

Cross border M As; Diversification; Theoretical foundation

Indexed keywords

EID: 4344579713     PISSN: 10754253     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.intman.2004.05.005     Document Type: Article

References (121)

1. Agarwal S. Ramaswami S. Choice of foreign market entry mode: impact of ownership, location and internalization factors J. Int. Bus. Stud. 23 1992 1-27
2. Anand J. Delios A. Absolute and relative resources as determinants of international acquisitions Strateg. Manage. J. 23 2002 119-134
3. Andersen O. Internationalization and market entry mode: a review of theories and conceptual framework Manag. Int. Rev. 37 1997 27-42
4. Anderson E. Gatignon H. Modes of foreign entry: a transaction cost analysis and propositions J. Int. Bus. Stud. 17 1986 1-26
5. Andersson U. Johanson J. Vahlne J.E. Organic acquisitions in the internationalisation process of the business firm Manag. Int. Rev. 37 1997 67-84
6. Angwin D. Mergers and acquisitions across European borders: national perspectives on pre-acquisition due diligence and the use of professional advisors J. World Bus. 36 1 2001 32-57
7. Ashkenas R.N. Francis S.C. Integration managers: special leaders for special times Harvard Bus. Rev. 78 6 2000 108-116
8. Ashkenas R.N. DeMonaco L.J. Francis S.C. Making the deal real: How GE Capital integrates acquisitions Harvard Bus. Rev. 76 1 1998 165-178
9. Barkema H.G. Vermeulen F. International expansion through start-up or acquisition: a learning perspective Acad. Manage. J. 41 1998 7-26
10. Barkema H.G. Bell J.H.J. Pennings J.M. Foreign entry, cultural barriers and learning Strateg. Manage. J. 17 1996 151-166
11. Beckman C.M. Haunschild P.R. Network learning: the effects of partners' heterogeneity of experience on corporate acquisitions Adm. Sci. Q. 47 2002 92-124
12. Bhagat R.S. Kedia B.L. Harveston P.D. Triandis H.C. Cultural variations in the cross-border transfer of organizational knowledge: an integrative framework Acad. Manage. Rev. 27 2002 204-221
13. Bresman J. Birkinshaw J. Nobel R. Knowledge transfer in international acquisitions J. Int. Bus. Stud. 30 1999 439-463
14. Brouthers K.D. Institutional, cultural and transaction cost influences on entry mode choice and performance J. Int. Bus. Stud. 33 2002 203-221
15. Brouthers K.D. Brouthers L.E. Acquisition or greenfield start-up? Institutional, cultural and transaction cost influences Strateg. Manage. J. 21 2000 89-97
16. Buckley P. Casson M. The Future of Multinational Enterprise 1976 Macmillan London
17. Cakici N. Hessel C. Tandon K. Foreign acquisitions in the United States: effect on shareholder wealth of foreign acquiring firms J. Bank. Financ. 20 2 1996 307-329
18. Calori R. Lubatkin M. Very P. Control mechanisms in cross-border acquisitions: an international comparison Organ. Sci. 15 1994 361-379
19. Calori R. Lubatkin M. Very P. Veiga J.F. Modeling the origins of nationally-bound administrative heritages: a historical institutional analysis of French and British firms Organ. Sci. 8 1997 681-696
20. Caves R.E. Economic Analysis and the Multinational Corporation 2nd ed. 1996 Cambridge Univ. Press Cambridge, UK
21. Cebenoyan A.S. Papaioannou G. Travlos N.G. Foreign takeover activity in the U.S. and wealth effects for target firm shareholders Financ. Manage. 21 3 1992 58-68
22. Chatterjee S. Lubatkin M.H. Schweiger D.M. Weber Y. Cultural differences and shareholder value in related mergers linking equity and human capital Strateg. Manage. J. 13 1992 319-334
23. Child J. Falkner D. Pitkethly R. The Management of International Acquisitions 2001 Oxford Univ. Press Oxford, UK
24. Cho K.R. Padmanabhan P. Acquisition versus new venture: the choice of foreign establishment mode by Japanese firms J. Internat. Manag. 1 1995 255-285
25. Datta D. Puia G. Cross-border acquisitions: an examination of the influence of relatedness and cultural fit on shareholder value creation in U.S. acquiring firms Manag. Int. Rev. 35 1995 337-359
26. Davis P.S. Desai A.B. Francis J.D. Mode of international entry: an isomorphism perspective J. Int. Bus. Stud. 31 2000 239-258
27. Delios A. Beamish P.W. Ownership strategy of Japanese firms: transactional, institutional, and experience influence Strateg. Manage. J. 20 1999 915-933
28. Dewenter K.L. Does the market react differently to domestic and foreign takeover announcements? Evidence from the U.S. chemical and retail industries J. Financ. Econ. 37 1995 421-441
29. Dunning J. Multinational Enterprises and the Global Economy 1993 Addison-Wesley Publishing Reading, MA
30. Economist Faites vos jeux, December 4 1999 63
31. Emerson V. An interview with Carlos Ghosn, President of Nissan Motors and industry leader of the year Sloan Manage. Rev. 36 1 2001 3-10
32. Erramilli M.K. D'Souza D.E. Venturing into foreign markets: the case of small service firms Entrep. Theory Pract. 17 4 1993 29-41
33. Erramilli M.K. Agarwal S. Kim S. Are firm-specific advantages location-specific too? J. Int. Bus. Stud. 28 1997 735-757
34. Finkelstein S. Haleblian J. Understanding acquisition performance: the role of transfer effects Organ. Sci. 13 2002 36-47
35. Gedajlovic E.R. Shapiro D.M. Management and ownership effects: evidence from five countries Strateg. Manage. J. 19 1998 533-553
36. Gulati R. Social structure and alliance formation patterns: a longitudinal analysis Adm. Sci. Q. 4 1995 619-652
37. Hall R. The strategic analysis of intangible resources Strateg. Manage. J. 13 1992 35-144
38. Hamel G. Competition for competence and inter-partner learning within international strategic alliances Strateg. Manage. J. 12 1991 83-103
39. Harris R.S. Ravenscraft D. The role of acquisitions in foreign direct investment: evidence from the U.S. stock market J. Finance 46 1991 825-844
40. Harrison J.S. Hitt M.A. Hoskisson R.E. Ireland R.D. Synergies and post-acquisition performance: similarities versus differences in resource allocations J. Manage. 17 1991 173-190
41. Harrison J.S. Hitt M.A. Hoskisson R.E. Ireland R.D. Resource complementarity in business combinations: extending the logic to organizational alliances J. Manage. 27 2001 679-690
42. Harzing A.W. Acquisitions versus greenfield investments: international strategy and management of entry modes Strateg. Manage. J. 23 2002 211-227
43. Haspeslagh P.C. Jemison D.B. Managing Acquisitions: Creating Value Through Corporate Renewal 1991 The Free Press New York
44. Haunschild P.R. Miner A.S. Modes of interorganizational imitation: the effects of outcome salience and uncertainty Adm. Sci. Q. 42 1997 472-500
45. Hayward M.L.A. When do firms learn from their acquisition experience? Evidence from 1990-1995 Strateg. Manage. J. 23 2002 21-39
46. Hennart J.F. Park Y.R. Greenfield versus acquisition: the strategy of Japanese investors in the United States Manage. Sci. 39 1993 1054-1070
47. Hennart J.F. Park Y.R. Location, governance, and strategic determinants of Japanese manufacturing investment in the United States Strateg. Manage. J. 15 1994 419-436
48. Hennart J.-F. Reddy S. The choice between mergers/acquisitions and joint ventures: the case of Japanese investors in the United States Strateg. Manage. J. 18 1997 1-12
49. Henry D. Mergers: why most big deals don't pay off Bus. Week, October 14 2002 60-70
50. Hitt M.A. The new frontier: transformation of management for the new millennium Organ. Dyn. 28 2000 6-17
51. Hitt M.A. Hoskisson R.E. Ireland R.D. Harrison J.S. Effects of acquisitions on R-D inputs and outputs Acad. Manage. J. 34 1991 693-706
52. Hitt M.A. Dacin M.T. Tyler B.D. Park D. Understanding the differences in Korean and U.S. executives' strategic orientations Strateg. Manage. J. 18 1997 159-167
53. Hitt M.A. Harrison J.S. Ireland R.D. Best A. Attributes of successful and unsuccessful acquisitions of U.S. firms Br. J. Manage. 9 1998 91-114
54. Hitt M.A. Keats B.W. DeMarie S.M. Navigating in the new competitive landscape: building strategic flexibility and competitive advantage in the 21st century Acad. Manage. Exec. 12 4 1998 22-42
55. Hitt M.A. Dacin M.T. Levitas E. Arregle J.-L. Borza A. Partner selection in emerging and developed market contexts: resource-based and organizational learning perspectives Acad. Manage. J. 43 2000 449-467
56. Hitt M.A. Harrison J.S. Ireland R.D. Mergers and Acquisitions: A Guide to Creating Value for Stakeholders 2001 Oxford Univ. Press New York
57. Hitt M.A. Ireland R.D. Camp S.M. Sexton D.L. Strategic entrepreneurship: entrepreneurial strategies for creating wealth Strateg. Manage. J. 22 Special Issue 2001 479-491
58. Hitt M.A. Ahlstrom D. Dacin M.T. Levitas E. Svobodina L. The institutional effects on strategic alliance partner selection in transition economies: China versus Russia Organ. Sci. 2004
59. Hoffmann W.H. Schaper-Rinkel W. Acquire or ally?-A strategic framework for deciding between acquisition and cooperation Manag. Int. Rev. 41 2001 131-159
60. Hofstede G. Culture's Consequences: International Differences in Work-Related Values 1980 Sage Beverly Hills, CA
61. House R. Javidan M. Hanges P. Dorfman P. Understanding cultures and implicit leadership theories across the globe: an introduction to project GLOBE J. World Bus. 37 1 2002 3-10
62. Huber G.P. Organizational learning: the contributing processes and literatures Organ. Sci. 2 special issue 1991 88-115
63. Inkpen A.C. Beamish P.W. Knowledge, bargaining power, and the instability of international joint ventures Acad. Manage. Rev. 22 1997 177-202
64. Inkpen A.C. Sundaram A.K. Rockwood K. Cross-border acquisitions of U.S. technology assets Calif. Manage. Rev. 42 Spring 2000 50-70
65. Jensen M.C. Agency costs of free cash flow, corporate finance and takeovers Am. Econ. Rev. 76 1986 323-329
66. Johanson J. Vahlne J. The internationalization process of the firm-a model of knowledge development and increasing foreign market commitments J. Int. Bus. Stud. 8 1977 3-32
67. Kang J. The international market for corporate control J. Financ. Econ. 34 1993 345-371
68. Kaplan S.N. Weisbach M.S. The success of acquisitions: evidence from divestitures J. Finance 47 1992 107-138
69. Kissin W.D. Herrera J. International mergers and acquisitions J. Bus. Strategy 11 July/August 1990 51-55
70. Kogut B. Research notes and communications. A note on global strategies Strateg. Manage. J. 10 1989 383-389
71. Kogut B. Singh H. The effect of national culture on the choice of entry mode J. Int. Bus. Stud. 19 1988 411-432
72. Kosnik R.D. Shapiro D.L. Agency conflicts between investment banks and corporate clients in merger and acquisition transactions: causes and remedies Acad. Manage. Exec. 11 1 1997 7-20
73. Krug J.A Hegarty W.H. Research notes and commentaries: predicting who stays and leaves after an acquisition: a study of top managers in multinational firms Strateg. Manage. J. 22 2001 185-196
74. Krug J.A. Nigh D. Top management departures in cross-border acquisitions: governance issues in an international context J. Internat. Manag. 4 1998 267-287
75. Krug J.A. Nigh D. Executive perceptions in foreign and domestic acquisitions: an analysis of foreign ownership and its effect on executive fate J. World Bus. 36 1 2001 85-105
76. Lamont B.T. Anderson C.R. Mode of corporate diversification and economic performance Acad. Manage. J. 28 1985 926-934
77. Larsson R. Finkelstein S. Integrating strategic, organizational, and human resource perspective on mergers and acquisitions: a case survey of synergy realization Organ. Sci. 10 1999 1-26
78. Lee T.-J. Caves R.E. Uncertain outcomes of foreign investment: determinants of the dispersion of profits after large outcomes J. Int. Bus. Stud. 29 1998 563-582
79. Levinthal D.A. March J.G. The myopia of learning Strateg. Manage. J. 14 1993 95-112
80. Li J. Guisinger S. Comparative business failures of foreign-controlled firms in the United States J. Int. Bus. Stud. 22 1991 209-224
81. Lubatkin M. Calori R. Very P. Veiga J.F. Management mergers across borders: a two-nation exploration of a nationally bound administrative heritage Organ. Sci. 9 1998 670-684
82. Madhok A. Cost, value and foreign market entry mode: the transaction and the firm Strateg. Manage. J. 18 1997 39-61
83. Manzon G.B. Sharp D.J. Travlos N.G. An empirical study of the consequences of U.S. tax rules for international acquisitions by U.S. firms J. Finance 49 1994 1893-1904
84. March J.G. Exploration and exploitation in organizational learning Organ. Sci. 2 1991 1-87
85. Markides C.C. Ittner C.D. Shareholder benefits from corporate international diversification: evidence from U.S. international acquisitions J. Int. Bus. Stud. 25 1994 343-367
86. Martin X. Swaminathan A. Mitchell W. Organizational evolution in the interorganizational environment: incentives and constraints on international expansion strategy Adm. Sci. Q. 43 1998 566-601
87. Morck R. Yeung B. Why investors value multinationality J. Bus. 64 1991 165-187
88. Morck R. Yeung B. Internalization: an event study test J. Int. Econ. 33 1992 41-56
89. Morosini P. Shane S. Singh H. National cultural distance and cross-border acquisition performance J. Int. Bus. Stud. 29 1998 137-158
90. Mowery D.C. Oxley J.E. Silverman B.S. Strategic alliances and interfirm knowledge transfer Strateg. Manage. J. 17 Winter special issue 1996 77-91
91. Nahavandi A. Malekzadeh A.R. Acculturation in mergers and acquisitions Acad. Manage. Rev. 13 1988 79-90
92. Nakos G. Brouthers K.D. Entry mode choice of SMEs in Central and Eastern Europe Entrep. Theory Pract. 27 Fall 2002 47-64
93. Nevin J.J. The Bridgestone/Firestone story Calif. Manage. Rev. 32 1990 114-132
94. Newburry W. Zeira Y. Generic differences between equity international joint ventures (EIJVs), international acquisitions (IAs), and international greenfield investments (IGIs): implications for parent companies J. World Bus. 32 2 1997 87-102
95. Newman K.L. Organizational transformation during institutional upheaval Acad. Manage. Rev. 25 2000 602-619
96. Nitsch D. Beamish P. Makino S. Entry mode and performance of Japanese FDI in Western Europe Manag. Int. Rev. 36 1996 27-43
97. Olie R. Shades of culture and institutions in international mergers Organ. Stud. 15 1994 381-405
98. Pan Y. Tse D.K. The hierarchical model of market entry modes J. Int. Bus. Stud. 31 2000 535-554
99. Porter M.E. From competitive advantage to corporate strategy Harvard Bus. Rev. 65 3 1987 43-59
100. Porter M.E. The Competitive Advantage of Nations 1990 Free Press New York
101. Ram̀rez-Alesòn M. Espitia-Escuer M.A. The effect of international diversification strategy of the performance of Spanish based firms during the period 1991-1995 Manag. Int. Rev. 41 2001 291-315
102. Reuer J.J. From hybrids to hierarchies: shareholder wealth effect of joint venture buyouts Strateg. Manage. J. 22 2001 27-44
103. Risberg A. Employee experiences of acquisition processes J. World Bus., Spring 36 1 2001 58-84
104. Sebenius J.K. Case study: negotiating cross-border acquisitions Sloan Manage. Rev. 39 winter 1998 27-41
105. Servaes H. Tobin's Q and the gains from takeover J. Finance 46 1991 409-419
106. Seth A. Song K.P. Pettit R.R. Value creation and destruction in cross-border acquisitions: an empirical analysis of foreign acquisitions of U.S. firms Strateg. Manage. J. 23 2002 921-940
107. Shane S. Uncertainty avoidance and the preference for innovation championing roles J. Int. Bus. Stud. 26 1995 47-68
108. Shaver J.M. Accounting for endogeneity when assessing strategy performance: does entry mode choice affect FDI survival? Manage. Sci. 44 1998 571-585
109. Shimizu K. Imperfect learning: what does an organization learn from its mistake? Academy of Management Meeting Best Paper Proceedings, Chicago: IL 1999
110. Shimizu K. Hitt M.A. What constrains or facilitates divestitures of formerly acquired firms? J. Manage. 2004
111. Short H. Ownership, control, financial structure and the performance of firms J. Econ. Surv. 8 3 1994 203-250
112. Vermeulen F. Barkema H.G. Learning through acquisitions Acad. Manage. J. 44 2001 457-476
113. Very P. Schweiger D.M. The acquisition process as a learning process: evidence from a study of critical problems and solutions in domestic and cross-border deals J. World Bus. 36 1 2001 11-31
114. Very P. Lubatkin M. Calori R. A cross-national assessment of acculturative stress in recent European mergers Int. Stud. Manage. Organ. 26 1996 59-88
115. Very P. Lubatkin M Calori R. Veiga J. Relative standing and the performance of recent European mergers Strateg. Manage. J. 18 1997 593-615
116. Weber Y. Shenkar O. Raveh A. National and corporate fit in M-A: an exploratory study Manage. Sci. 4 1996 1215-1227
117. Werner S. Recent development in international management research: a review of 20 top management journals J. Manage. 28 2002 277-305
118. Williamson O.E. Markets and Hierarchies: Analysis and Antitrust Implications 1975 Free Press New York
119. Wilson B.D. The propensity of multinational companies to expand through acquisitions J. Int. Bus. Stud. 11 1980 59-64
120. Zaheer S. Overcoming the liability of foreignness Acad. Manage. J. 38 1995 341-363
121. Zahra S.A. Ireland R.D. Gutierrez I. Hitt M.A. Privatization and entrepreneurial transformation: emerging issues and a future research agenda Acad. Manage. Rev. 25 2000 509-524