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Looking into the ‘black box’- unlocking the effect of integration on acquisition performance

Published on Aug 1, 2017in European Management Journal2.98
· DOI :10.1016/j.emj.2017.06.002
Satu Teerikangas7
Estimated H-index: 7
(UTU: University of Turku),
I.C. Thanos8
Estimated H-index: 8
(Lancaster University)
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Abstract
Abstract Extending research on the performance of Mergers and Acquisitions (M&As), this paper seeks to explain how the post-acquisition integration phase affects acquisition performance. Despite extensive research efforts, there remains a scant understanding of how acquisition implementation, particularly in the post-acquisition integration phase, impacts the performance of M&As. Based on an extensive study of eight acquisitions, in this paper, a grounded model detailing the mechanisms by which the post-acquisition integration phase affects acquisition performance is developed. The model posits that integration-related factors do not bear directly upon acquisition performance. Instead, their effect is mediated by functional organizations in both firms. When focusing into these functional mediating dynamics, we observe that integration-related processual, behavioral and cultural factors affect the identified functional mediators in different ways. Going forward, we echo calls for integrated perspectives to the study of M&A and M&A performance in particular.
  • References (80)
  • Citations (1)
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References80
Newest
Published on Oct 1, 2017in International Journal of Management Reviews7.60
Norbert Steigenberger6
Estimated H-index: 6
(University of Cologne)
The integration of acquired or merging firms is a key driver of the success or failure of mergers and acquisitions (M&As). Over the last 30 years, a substantial body of research has addressed M&A integration, offering rich but widely dispersed insights into this phenomenon. This paper takes stock of the current knowledge, based on a review of articles published in scholarly journals. The review advances the conceptual understanding of the phenomenon by inductively developing an overarching frame...
Published on Jan 1, 2017in The Academy of Management Annals12.29
Melissa E. Graebner1
Estimated H-index: 1
(UTD: University of Texas at Dallas),
Koen H. Heimeriks13
Estimated H-index: 13
+ 1 AuthorsEero Vaara41
Estimated H-index: 41
Mergers and acquisitions (M&As) continue to be prevalent despite frequently yielding disappointing outcomes. Postmerger integration plays a critical role in M&A success, yet many questions about M&A implementation remain unanswered. In this article, we review research on postmerger integration, which we organize around strategic integration, sociocultural integration, and experience and learning. We then lay out a research agenda that centers on expanding our understanding of processual dynamics...
Published on Feb 1, 2016in International Business Review3.64
Mohammad Faisal Ahammad9
Estimated H-index: 9
(NTU: Nottingham Trent University),
Shlomo Y. Tarba23
Estimated H-index: 23
(University of Sheffield)
+ 1 AuthorsKeith W. Glaister31
Estimated H-index: 31
(Warw.: University of Warwick)
The current understanding of when and how knowledge transfer leads to cross-border acquisition (CBA) success is still limited. The aims of the paper are to provide new insights into the factors that facilitate or impede knowledge transfer, and to examine the impact of knowledge transfer on CBA performance. The data were gathered via a cross-sectional survey using a questionnaire on a sample of UK firms that had acquired North American and European firms. The findings indicate that knowledge tran...
Published on Aug 1, 2015in Long Range Planning3.36
Duncan Angwin13
Estimated H-index: 13
(Oxford Brookes University),
Maureen Meadows18
Estimated H-index: 18
The post-acquisition integration phase is widely recognized as critical to the M&A process. However post-acquisition typologies suffer from inadequate empirical support or lack of comprehensiveness. This empirical paper responds to calls for methodological pluralism in M&A research, and uses a mixed method to assess the robustness of a leading post-acquisition integration typology. Through multiple cluster analyses, different post-acquisition strategies are identified and qualitative techniques ...
Jiali Zhang1
Estimated H-index: 1
(NTU: Nottingham Trent University),
Mohammad Faisal Ahammad9
Estimated H-index: 9
(NTU: Nottingham Trent University)
+ 3 AuthorsJinmin Wang5
Estimated H-index: 5
(University of Nottingham)
Leadership and talent retention are critical HR-related components in post-merger and acquisition (M&A) integration, but the extent to which these factors interact with each other and eventually contribute to the success of post-M&A integration is under-explored. The present study investigates the effect of leadership styles on talent retention strategies and on the effectiveness of post-M&A integration in a Chinese context. Based on in-depth examination of an M&A case study, we propose that an ...
Published on Sep 1, 2014in Strategic Management Journal5.57
Eero Vaara41
Estimated H-index: 41
(Hanken School of Economics),
Paulina Junni10
Estimated H-index: 10
(BI Norwegian Business School)
+ 2 AuthorsAlexei Koveshnikov7
Estimated H-index: 7
(Hanken School of Economics)
This paper focuses on managers' attributions of M&A performance. Our analysis indicates that there is a linear association between performance and attributions to cultural differences, which is moderated by prior experience. Furthermore, our results suggest that there is a curvilinear association between performance and attributions to managers' actions, but we found no support for the moderating effect of experience for this association. By substantiating these attributional tendencies, our res...
Published on Feb 1, 2014in Strategic Management Journal5.57
Florian Bauer8
Estimated H-index: 8
(MCI Management Center Innsbruck),
Kurt Matzler44
Estimated H-index: 44
(University of Innsbruck)
In this paper, we develop a comprehensive model of M&A success. We integrate fundamental constructs of different schools and discuss their interdependencies with M&A success. Our theoretical framework was tested empirically across a sample of 106 SME transactions in the machinery, electronic, and logistic industries in the German-speaking part of Central Europe. The results of our study support the demand for an integrative perspective and theory on M&A. M&A success is a function of strategic co...
Published on Jan 1, 2014
Duncan Angwin13
Estimated H-index: 13
,
Uma Urs2
Estimated H-index: 2
Abstract Post-acquisition integration matters for overall M&A outcome. However within this phase researchers have struggled to identify clear links between integration activities and post-acquisition outcome. This may be due to using organisational levels of analysis, where sub-organisational issues serve to confound findings. In order to unpack the post-acquisition phase, and to delve more deeply into organisations, this paper adopts a more granular perspective on integration activities by focu...
Published on Jan 1, 2014
Satu Teerikangas7
Estimated H-index: 7
,
Tomi Laamanen14
Estimated H-index: 14
Abstract While there is an increasing understanding of the challenges that can emerge in integration processes of cross-border mergers and acquisitions, there is a scarcity of research on how the different integrative activities should be temporally sequenced. Based on an in-depth analysis of three acquisitions, we find that structural and cultural integration are intertwined. We find that cultural integration will begin only once structural integration is in progress. Cultural differences can, ...
Published on Oct 1, 2013in Journal of Business Research4.03
Veneta Andonova6
Estimated H-index: 6
(University of Los Andes),
Yeny Rodriguez1
Estimated H-index: 1
(University of Los Andes),
Ivan Dario Sanchez1
Estimated H-index: 1
(University of Los Andes)
This study looks into the behavior of privately held firms in Colombia that participate in waves of mergers and acquisitions between 1995 and 2008. The study finds evidence in which experienced firms that perform mergers and acquisitions late in waves show stronger performance as measured by their return on assets. The firms that fall prey to the bandwagon effect and perform M&As at the peak of a wave show the weakest performance in munificent industries. The study discusses the rationality behi...
Cited By1
Newest
Published on Apr 1, 2019in International Business Review3.64
Lauri Haapanen1
Estimated H-index: 1
(University of Oulu),
Pia Hurmelinna-Laukkanen19
Estimated H-index: 19
(University of Oulu)
+ 1 AuthorsPertti Paakkolanvaara1
Estimated H-index: 1
(University of Oulu)
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...
Published on Jun 1, 2019in European Management Journal2.98
I.C. Thanos8
Estimated H-index: 8
(Lancaster University),
Duncan Angwin13
Estimated H-index: 13
(Lancaster University)
+ 1 AuthorsSatu Teerikangas7
Estimated H-index: 7
(UCL: University College London)
View next paperThe State of Post Acquisition Performance Literature: Where to from Here?