Download or read book The high failure rates of cross border mergers due to the focus of companies on hard factors written by Tracey Roberts and published by GRIN Verlag. This book was released on 2009-10-21 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt: Bachelor Thesis from the year 2005 in the subject Business economics - Business Management, Corporate Governance, grade: 2.0, New College Durham, course: Strategic Business Management, language: English, abstract: In today’s economy of globalization, technological change, an increase in innovation and shorter product life cycles have led to intensified international competition. The result is an increase in productivity and capital requirements due to high R&D and growing quality costs. Cross-border mergers have become a predominant form of global expansion and a common possibility of adapting to changing market conditions (Buchner, 2002, p. 21). As the described economic development will continue and may become even stronger, the requirement for cross-border mergers exists (Gösche, 1991, p. 153). However, statistics show that the failure rate has been quite high (see p.13, 2.3). The author will investigate critical success factors, that are often neglected and the main cause of failure. By failure the author does not mean a complete failure, but that the merged company has not achieved its expected goals. Based on preliminary research and existing knowledge, the analysis of critical success factors will mainly refer to soft factors. In cross-border mergers cultural issues in the form of organizational and national culture play an important role (Gertsen et al., Cultural Dimensions in International Mergers and Acquisitions, 1998). Furthermore, the author will focus on change management, as mergers bring along major changes that have enormous impact on managers and employees. In this context the effect of knowledge management and communication will also be analysed (Buchner, Der Mensch im Merger, 2002). As these issues will have to be considered at certain stages within the merging process, emphasis will also be laid on due diligence and the integration process (Galpin & Herndon, The Complete Guide to Mergers and Acquisitons, 2000).
Download or read book Cross Border Mergers Or Acquisitions Issues A Meta Analytical Approach written by Ekene Martin Adimike and published by LAP Lambert Academic Publishing. This book was released on 2014-05 with total page 84 pages. Available in PDF, EPUB and Kindle. Book excerpt: World Investment Report, 2013 predicted a drop of 32 per cent in the Global FDI, this also affected Cross-Border M&A as a major form of Global FDI in 2013 as a result of globalization. Globalization has created an extremely competitive business environment across the world and as such the need to increase profits and shareholders' value constantly presses International Business Executives. Consequently, Mergers and Acquisitions (M&A) have been the preferred method of increasing growth and achieving target improvements in revenue. There are success or failure factors identified by many studies responsible for the trend. The immense benefits accruing from these transactions make the study imperative so that mergers will focus their resources on the success factors while minimizing the failure factors. As a result of these, Cross-Border M&A has achieved some milestones as a form of FDI and Globalization option used by many Multinationals.
Download or read book The Long Term Success of Cross Border Mergers and Acquisitions written by Thomas A. Carnes and published by . This book was released on 2003 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: Although there has been an exponential increase in the number and size of cross-border mergers during the past decade, there is little research that examines whether such deals are value-enhancing activities for shareholders of successful bidders. We investigate long-term abnormal returns to 361 successful U.S. bidders for foreign targets between 1985 and 1995. Employing a procedure recommended by Lyon et al. (1999) in order to minimize bias in calculating such returns, we find that abnormal returns are significantly negative over both a three- and a five-year window for successful bidders in cross-border mergers. We then divide the firms based upon categorizations employed by Ali and Hwang (2000), who examine country-specific factors related to the value relevance of accounting data. We hypothesize that factors which make accounting data less value-relevant (e.g., the level of alignment of financial and tax accounting) also will make it more difficult for bidding firms to price targets accurately in these countries. If this is true, bidder firms acquiring targets in these countries should realize larger negative abnormal returns. However, we find that negative abnormal returns are smaller in such countries. This may be due to a higher cost of capital for firms in these countries, resulting in a built-in discount to bidders.
Download or read book The impact of cultural differences on the post merger performance in international acquisitions written by Ricardo Escoda and published by GRIN Verlag. This book was released on 2017-09-05 with total page 29 pages. Available in PDF, EPUB and Kindle. Book excerpt: Seminar paper from the year 2017 in the subject Business economics - Miscellaneous, grade: 1,7, University of Augsburg, language: English, abstract: As the number of international mergers and acquisitions (M&As) increased formidable during the last decades, it is a highly discussed phenomenon, which is becoming more and more important (Erel et al., 2012). Nearly 30 years ago, in 1987, there have been merely 5.000 M&As worldwide, whereas in 2016 already 50.000 M&As were concluded and latest stats even predict increasing numbers of M&As. M&A experience might both harm and help post-merger performance in international acquisitions. As stated by Schoenberg (2000) national cultural differences mainly present a strong challenge for cross-border acquisitions. Since the initial financial expectations are met simply by one half of all M&As, cultural differences might be at fault for this high failure rate (Zollo and Meier, 2008). Given that cross-border M&As consolidate two or more different cultures, it has to be taken into consideration that incidents such as differing legislations, currencies, languages and cultural norms do play an essential role. As a result of those distinctions, costs to the integration process might occur and the capability of firms to achieve synergies might be subverted. Thereby, the expected economic advantages of the merger or acquisition will be affected, too. Key factors like the integration of the participating companies in each other and enormous adaptation operations are irrecoverable to accomplish synergies and advantages of M&As. The hypothesis whether national cultural differences between acquirers and targets are likely to undermine post-merger performance has been researched myriad. An appropriate classification reclines in whether cultural differences matter, when they matter, under what conditions and in which way they do. The elaboration of this paper is based on the theory of Hofstede (1980), who was one of the first to explicitly address the impact of culture on the integration process of M&As by explaining cultural differences might generate misunderstandings and conflicts between the two merging organisations. Hence the aim of our analysis is to dissect the impact of cultural differences on the post-merger performance in international acquisitions by focussing on two out of four dimensions of Hofstede (1980) by means of the works of Ahern et al. (2009) and Huang et al. (2017).
Download or read book Cultural Complexities in Cross Border Mergers Acquisitions written by Oyvin Kyvik and published by GRIN Verlag. This book was released on 2011-03-16 with total page 20 pages. Available in PDF, EPUB and Kindle. Book excerpt: Research Paper (postgraduate) from the year 2011 in the subject Business economics - Business Management, Corporate Governance, grade: none, University of Pompeu Fabra (ESCI (School of International Trade) ), language: English, abstract: Based on a review of pertinent literature, the paper discusses the role and the complexities of cross-border mergers and acquisition in firms ́ internationalization. The various stages that firms customarily go through as part of an international merger and acquisition process are outlined and debated from both a theoretical and practical perspective. Particular challenges related to the management of the post- merger integration process and complexities related to differences in national and organizational cultures, organizational design and knowledge-structures between the acquirer and the target company are discussed. It is argued that appropriate management of the merging firms ́ human resources as the merging firms ́ smallest common denominator, is the key to optimize the outcome of cross-border transactions and to achieve budgeted post-merger benefits. Based on the conceptual discussion, the paper concludes with key recommendations for how to manage a cross-border deal to minimize risks and increase the probability of achieving the objectives.
Download or read book Cross Border Mergers and Acquisitions written by Mohammad Bedier and published by Edward Elgar Publishing. This book was released on 2018-09-28 with total page 400 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides the reader with an overview of the origin of corporations and the history of mergers and acquisitions. It demystifies the dynamics of mergers and identifies the unique impediments facing cross-border mergers and acquisitions, with great attention to the pre-merger control laws and regulations, in several regions (US, EU, and Middle East). Most importantly, it discusses and assesses merger deregulation and other key reforming proposals.
Download or read book International Corporate Governance Spillovers written by Rui Albuquerque and published by International Monetary Fund. This book was released on 2013-11-12 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: We develop and test the hypothesis that foreign direct investment promotes corporate governance spillovers in the host country. Using firm-level data on cross-border mergers and acquisitions (M&A) and corporate governance in 22 countries, we find that cross-border M&As are associated with subsequent improvements in the governance, valuation, and productivity of the target firms’ local rivals. This positive spillover effect is stronger when the acquirer is from a country with stronger shareholder protection and if the target’s industry is more competitive. We conclude that the international market for corporate control promotes the adoption of better corporate governance practices around the world.
Download or read book Factors Affecting Cross Border Mergers and Acquisitions written by Geraldo M. Vasconcellos and published by . This book was released on 1997 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This study applies a well-known approach for the analysis of investment projects to the investigation of cross-border mergers and acquisitions between Canadian and American firms in the period 1982-1990. The major purpose of the paper is to document the extent of the contribution of macroeconomic variables, such as exchange rates, bond yields, stock prices, and P/E ratios, to the recent trends in Canada-U.S. and U.S.- Canada cross-border acquisitions, as distinct from industry and firm-specific variables. The results suggest that the levels of the yields on long-term debt securities in both countries and their difference contribute significantly to an explanation of the difference of Canadian acquisitions of U.S. firms and American acquisition of Canadian firms in the period.
Download or read book Cross Border Mergers and Acquisitions written by Scott C. Whitaker and published by John Wiley & Sons. This book was released on 2016-04-05 with total page 423 pages. Available in PDF, EPUB and Kindle. Book excerpt: Navigate cross border M&A for a flawless integration execution Cross Border Mergers and Acquisitions is a practical toolbox for corporate strategy and development professionals dealing with the many challenges involved in cross border M&A. With a detailed discussion of key market specifics and broadly-applicable critical insight, this book demystifies the cross border M&A process and provides a host of practical tools that ease strategic implementation. A geographical overview explains the trends in major M&A markets including Australia, Brazil, China, Russia, the U.K., and the U.S., and industry-specific guidance covers Financial Services, Aerospace and Defense, Health Care, Tech, Manufacturing, and more. Leading experts relate lessons learned while managing actual PMI (post merger integration) processes, and the discussion of cultural impacts and specific situational needs provides deep insight into the type of leadership a flawless integration requires. Corporate restructuring and internationalization efforts are increasingly relying on cross border mergers and acquisitions. Strategies, motives, and consequences are a complex navigational minefield, but this insightful guide provides solid, actionable guidance for leading a successful integration. Understand the region-specific details that make an impact Overcome common challenges and manage complex deals Gain practical insight and valuable tools for leading integration Learn the most current best practices for PMI® processes Cross border M&A is complex, with myriad challenges and obstacles inherent to the situation. Successful integration and a smooth transition are critical, and there's little wiggle room—it's a situation where you have only one chance to get it right. Cross Border Mergers and Acquisitions is an essential guide to the process, with key tools for execution.
Download or read book Does Financial Performance Improve Post Cross Border Merger and Acquisitions written by Vanita Tripathi and published by . This book was released on 2015 with total page 18 pages. Available in PDF, EPUB and Kindle. Book excerpt: The present study focuses upon the comparison between the pre and post merger financial performance of the Indian companies undertaking cross border mergers and acquisitions during 1998-2009. An attempt has been made to assess the performance on an aggregate basis, on the basis of timing of the acquisition - before crisis and during crisis and on the basis of the development status of the foreign targets' economies. The results revealed a significant increase in size accompanied with a decrease in profitability, liquidity and solvency. This could be due to various reasons - industry specific factors, timing of the acquisition, status of the development of the target's economy. The other reasons could be companies' inexperience in foreign markets owing to lesser knowledge of handling cross border mergers and acquisitions as compared to western counterparts. A disaggregated analysis on the basis of timing of crisis reported a significantly lower growth in the size for the Indian companies acquiring during the time of US crisis as compared to those which did acquisitions before the crisis. These companies also accounted a significant deterioration of profitability, liquidity and solvency due to an increase in the operating costs and decline in demand. Although, valuation of the foreign companies especially those located in US and Europe during the time of crisis had reduced but for the operation of the merged firms expenses have to be made. However deals done in developed countries provided a significantly higher increase in the size than those done in developing countries owing to higher number of acquisitions in the former group. But the profitability, liquidity and solvency decline was higher in case of deals accomplished in developed countries. Our results suggest that the companies should diversify their portfolio of international exposure. Developing countries are emerging as new breed of consumers. Thus the focus of cross border mergers and acquisitions should be a balanced one considering the time as well as the location of the target.
Download or read book Merging Across Borders written by Anne-Marie Søderberg and published by Copenhagen Business School Press DK. This book was released on 2003 with total page 296 pages. Available in PDF, EPUB and Kindle. Book excerpt: "'Merging across Borders' offers insight into social, cultural, communicative and political dynamics in complex organizational change processes following mergers and acquisitions; dynamics which have often been neglected in previous research. The book is written by a Nordic research team, and it is based on their extensive field study of a series of cross-border mergers and acquisitions leading to the creation of Nordea, the largest Nordic financial services group today."
Download or read book Policy Risk and Cross Border Mergers and Acquisitions The Role of Quality and Multiplexity of Home Host Country Relations written by Tsvetomira Vladimirova Bilgili and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Multinational enterprises operate in a volatile global environment and face high policy uncertainty and risks. Policy risk is a location-specific factor that has been shown to influence foreign direct investment decisions. However, foreign investors' responses to such risk may be influenced by the quality and strength of home-host country relations. Home-host country relations affect investors' expectations of value capture and control in the host market and as such constitute an important factor affecting cross-border investment. In this dissertation, I adopt a relational view to provide a more complete understanding of when and how policy risk influences cross-border mergers and acquisitions (M & As) by investigating the role of the macro structure in which nations are embedded. I focus on cross-border acquisitions in emerging economies. In the first part of the dissertation, I examine whether host country policy risk influences M & A activity in emerging economies. In addition, I conduct a country-dyad analysis, focusing on pairs of countries, to determine whether the effect of policy risk on cross-border M & As varies based on the properties of home-host country relations, namely, their (1) quality and (2) multiplexity. In the second part of the dissertation, I focus on the pre-completion stage of cross-border M & As and investigate the relationships of deal-specific factors with the likelihood of M & A deal completion and the duration of the negotiation process under varying levels of host country policy risk and properties of home-host ties. The results of the empirical analysis confirm that policy risk is consistently negatively associated with M & A outcomes at the country, country-dyad, and deal levels. In addition, results show that the effect of policy risk varies based on the quality and strength of home-host country relations. These findings provide corroborating evidence that policy risk is a significant source of uncertainty in host environments with important implications for firms considering cross-border M & As as a form of investment. Furthermore, the findings provide insights into why some firms are less sensitive to the deterring effects of host country policy risk than others.
Download or read book Are cross border Mergers and Acquisitions more successful between culturally similar countries in the EU written by Cheyenne Wijnant and published by GRIN Verlag. This book was released on 2017-10-02 with total page 81 pages. Available in PDF, EPUB and Kindle. Book excerpt: Master's Thesis from the year 2017 in the subject Business economics - General, grade: 7.00, Maastricht University (Finance), course: International Business, language: English, abstract: Cross-border mergers and acquisitions have increased significantly over the last two decades and have substantially changed the European industry, since it has become one of the leading approaches for firms to gain access to global markets. However, there has been little progress in the research literature investigating the role of culture in explaining the success of these cross-border transactions. This paper analyzes if cross-border M&As are more valuable for acquirers between culturally similar countries by investigating the countries’ cultural distance, legal origin, trust, Hofstede’s dimensions, and corporate governance measures. The results indicate that cultural distance has a positive and negative effect on bidder announcement returns. Legal origin has a negative effect on acquirer gains in cross-border M&A whereas trust has a positive but insignificant effect. Hofstede’s dimensions have no particular effect on the data set and corporate governance measures have a strong negative effect on bidder announcement returns. The robustness checks do not alter the results.
Download or read book International Post Merger Integration written by Martin Reimann and published by . This book was released on 2017 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The 1990s were a “merger decade”. Never before did as many organizations merge or acquire other organizations, and above all, on a global basis. Cross-border mergers and acquisitions have become a major strategic tool for growth of multinational companies (Cartwright/Cooper 1993). The number of cross-border deals increased spectacularly from approximately 2.500 in 1990 to about 6.500 in 2000 as a result of globalization and increasing competition, just to name two reasons (OECD 2001). Since 2000, however, the picture has changed dramatically. Because of weak capital markets, a tight lending environment, and slowing economies all over the world, post-merger organizations focus on integrating their businesses rather than further expanding them through mergers and acquisitions. Enterprise integration has become a top priority of organizations in the 2000s. Unfortunately, those integration efforts frequently are not fruitful. Several studies point to failure rates of 50 percent and more (Ravenscraft/Scherer 1987; Bekier/Bogardus/Oldham 2001; Adolph et al. 2001). Although there are literally hundreds of reasons why the failure rates are so high, many can be traced back to cultural differences. A.T. Kearney found that there is an explicit relationship between cultural barriers and the success of international mergers (Augustine 1999). Other researchers state that the underestimation of differences between national cultures is among the most frequent mistakes of international mergers and acquisitions' management (Cahill 1996; Vestring/King/Rouse 2003; Weber/Camerer 2003). Consequently, the failure rates are exceptionally high in cross-border mergers where differences between national cultures play an essential role (Cartwright 1998). If differences between national cultures are among the main reasons for problems in international mergers and acquisitions, what can be done to deal with those problems? Firstly, there is a need to diagnose differences between national cultures. To do so, a case study was applied in which cultural differences among German, US-American, and Japanese co-workers were diagnosed. The purpose of this study was to find out in which ways different cultural values and attitudes are effecting post-merger organizations in their integration phase. Secondly, management should implement measures for overcoming culture-bound problems during the post-merger phase. Hence, based on the survey's result, the paper introduces skills and methods, which might promote a smoother and more efficient integration process in future international mergers and acquisitions. The article is structured in the following manner: After an introductory outline of the terminology regarding national culture, we introduce relevant cultural dimensions and problem areas of international post-merger integration. We go on to describe the methodology and empirical model designed to test the central hypotheses (that differences between national cultures can explain whether problems occur in international post-merger integration), and to present the results of the study. After discussing the limitations of the study, we dwell on implications for the management of cultural differences in post-merger integration. In the final section, we draw the conclusions.
Download or read book Cross Border Mergers and Acquisitions written by Isil Erel and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: One of the most consequential events in any firm's lifetime is a major acquisition. Because of their importance, mergers and acquisitions (M&As) have been an enormous area of research. However, the vast majority of this research and survey papers summarizing this research have focused on domestic deals. Cross-border ones, however, constitute about 30% of the total number and 37% of the total volume of M&As around the world since the early 1990s. We survey the literature on cross-border M&As, focusing on international factors that can lead firms to acquire a firm in another country. Such factors include differences in economic development, laws, institutions, culture, labor rights, protection of intellectual property, taxes, and corporate governance.
Download or read book Mergers and acquisitions written by Hayley Sim and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Business written by 布卢姆斯伯里出版公司 and published by 中信出版社. This book was released on 2003 with total page 2176 pages. Available in PDF, EPUB and Kindle. Book excerpt: 责任者取自版权页。
