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Institutional determinants of ownership positions of foreign acquirers in Africa

Published on May 1, 2018in Global Strategy Journal2.73
· DOI :10.1002/gsj.1168
Kimberly M. Ellis10
Estimated H-index: 10
(FAU: Florida Atlantic University),
Bruce T. Lamont19
Estimated H-index: 19
(FSU: Florida State University)
+ 4 AuthorsHeather R. Parola3
Estimated H-index: 3
(University of Evansville)
Abstract
  • References (79)
  • Citations (1)
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References79
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Inconclusive findings about the effect of national cultural differences on post-acquisition performance may be created by the failure to distinguish among the different cultural dimensions and the asymmetry of cultural differences. To demonstrate a different approach, this study focuses on one dimension of national cultural values — power distance value (PDV) and develops a framework for the asymmetric effect of PDV differences in creating two types of conflicts. The analysis of 2,115 cross-bord...
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#1Duncan Angwin (Oxford Brookes University)H-Index: 15
#2Kamel Mellahi (Warw.: University of Warwick)H-Index: 37
Last. Emmanuel PeterH-Index: 2
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Communication is generally viewed as a critical component in mergers and acquisitions (M&A) performance, yet surprisingly little research has examined the link between different communication approaches and M&A outcomes. This paper provides a systematic empirical study to evaluate the link between communication approaches and M&As outcome. Specifically, a typology is created to examine interaction between the process and content of communication and M&A outcomes, in terms of employee commitment ...
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#1Olivier Bertrand (Skema Business School)H-Index: 17
#2Marie-Ann Betschinger (HSE: National Research University – Higher School of Economics)H-Index: 3
Last. Alexander Settles (RU: Rutgers University)H-Index: 5
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Research summary: In the context of economic nationalism, we investigate the relevance of political affinity between countries to the initial acquisition premium offered in cross-border acquisitions. Political affinity is defined as the similarity of national interests in global affairs. We argue that political affinity affects how foreign acquirers anticipate their bargaining position in their negotiations with domestic target firms. With decreasing political affinity, the host government becom...
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Technology policy influences the incentives and opportunities firms have to innovate and adapt to changing environments and thus has important implications for strategy and entrepreneurship. However, to date, strategy and entrepreneurship scholars have paid insufficient attention to technology policy. We underscore the importance of two dimensions of technology policy: (1) state funding for research and (2) state protection of intellectual property (IP). We then illustrate how interactions betwe...
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The current study contributes to the institution-based view of internationalization that is contingent upon the home country development. We examine the differential effects of formal and informal institutions on emerging market multinational corporations’ (EMNCs) ownership strategies. Facing a large informal institutional distance that represents diverse cultural beliefs, EMNCs opt for a low ownership position that alleviates legitimacy threat, whereas a large formal institutional distance lead...
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Purpose – During their process of going international, small and medium-sized manufacturing firms seek to establish long-term relationships with key importers in order to minimize the risks of doing business in a foreign market. In the process of establishing long-term relationships, exporters aim to create relational capital with key importers. Yet, the body of international marketing literature that addresses the importance of relational capital in exporter-importer (E-I) relationships is stil...
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#1Gerard H. Gaynor (Singapore Management University)H-Index: 46
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The share of equity foreign acquirers obtain in targets is relevant to important aspects of firm strategy. Drawing on institutional theory, we examine the impact of regulatory institutional distance on foreign investors’ choice of percentage of shares acquired in targets in the transition post-Soviet economies of the Caucasus and Central Asia. In addition, we explore the moderating role of historical ties between the acquirer and target nations on the proposed relationship. Our sample consists o...
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We introduce a measure called ethno-linguistic fractionalization (ELF), which captures the ethnic and/or linguistic diversity in a country and examine its implications on existing cultural measures. Not only do high levels of fractionalization affect the use of statistical means to account for cultural distance (CD), we show that it is not constant and therefore the dynamics of change need to be addressed. We pursue the study of the dynamics and potential endogeneity through an in-depth case stu...
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#1Ronald Klingebiel (Frankfurt School of Finance & Management)H-Index: 7
#2Christian Stadler (Warw.: University of Warwick)H-Index: 13
This editorial complements Michael Mol and Kamel Mellahi's commentary on promising research directions by taking a look at opportunities and pitfalls in empirical research in and about Africa. It highlights some interesting examples of data sources that carry the potential to further theory of strategic management in general, an objective central to the proliferation of African empirics in mainstream theory journals. The Africa researcher has to, at least initially, jump through a number of extr...
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Abstract We investigate the impact of informal institutional distance and formal institutions on a key decision (namely location choice) of multinational enterprises (MNEs) when they expand abroad through foreign direct investment. The findings of the research that has analyzed these decisions have been non-conclusive, and this study aims to provide further theoretical and empirical evidence by considering the interaction effect of informal institutional distance and formal institutions in the l...
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Abstract This paper examines global financial markets perception of value creation for banks from across the world initiating or expanding their operations on the African continent through mergers and acquisitions (M&As) over the period 2000–2018. Especially before and during the financial crisis, we document a strong advantage of Pan-African Banks (PABs) over domestic and emerging market banks and a slight advantage over advanced market banks. These results are in line with the hypothesis that ...
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#1Alvaro Cuervo-Cazurra (NU: Northeastern University)H-Index: 33
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