Purpose Post-merger integration (PMI) is driven by coevolving processes. By integrating the literature on acquisitions with that of knowledge networks, this paper highlights different reconstruction mechanisms for dual knowledge networks during PMI – namely, internal knowledge network coupling and external knowledge network embeddedness. This paper aims to examine their coevolutionary relationships with PMI. Design/methodology/approach A coevolutionary framework is tested using a latent growth model and cross-lagged models. The analysis is based on longitudinal data collected from 116 Chinese technology-sourcing overseas merger and acquisition firms. Findings This paper unearths a novel idea that variations in post-merger reconstruction of dual knowledge networks can explain why some acquirers increase the degree of integration faster than the others. The results show that the internal knowledge network coupling leads to more knowledge similarity and, in turn, causes a higher degree of integration. The external knowledge network embeddedness also causes higher relative network status of the acquirer, which consequently leads to a higher degree of integration. Furthermore, results from cross-lagged models confirm that an increase in the degree of integration positively influences subsequent changes in the internal knowledge network coupling and external knowledge network embeddedness, thus forming a coevolutionary relationship over time. Originality/value This paper responds to recent calls for more insights into the dynamics of PMI. By highlighting different reconstruction mechanisms for internal and external knowledge networks during PMI, this paper explains why it is important to understand PMI dynamics from a dual knowledge network perspective. This paper is the first to adopt a coevolutionary perspective and provide a more comprehensive dynamic framework between PMI and reconstruction of dual knowledge networks. Besides, this paper contributes to the research on emerging market multinational corporations’ cross-border merger and acquisition integration from a dynamic perspective, revealing the time effects of traditionally favored light-touch integration.

Purpose The purpose of the paper is to examine the coevolutionary dynamics between multistage overseas mergers and acquisitions (M&A) integration and knowledge network reconfiguration and the impact of this coevolution on industrial technology innovation. Design/methodology/approach This paper builds a coevolution analysis framework in stages and constructs structural equation models for empirical tests using the Chinese technology-sourcing overseas M&A events that occurred from 2001 to 2012. Findings Overseas M&A integration and knowledge network reconfiguration are in a coevolutionary relationship, driving industrial technology innovation. The acquirer adopts initial integration degree that matches the resource relatedness between the acquiring and acquired parties, promoting initial industrial technology innovation through initial knowledge network reconfiguration. Initial knowledge network reconfiguration will feed back to the M&A integration decision in the mid-to-late stage through increasing knowledge similarity and narrowing network position difference. The higher the improvement of mid-to-late integration degree, the more it can drive mid-to-late industrial technology innovation through mid-to-late knowledge network reconfiguration. Research limitations/implications Future research can accurately classify overseas M&A integration stages through case tracking and explore other network attributes. Practical implications Practical guidelines are provided for managers on how to implement a multistage overseas M&A integration strategy, optimize knowledge network reconfiguration and promote industrial technology innovation. Significant practical implications are presented, especially in academia, society and quality of life. Originality/value Different from the previous research considering M&A integration as a single-stage decision, this paper emphasizes the dynamics of the M&A integration process and explores the coevolution mechanism of multistage overseas M&A integration and knowledge network reconfiguration.

Purpose Post-merger integration (PMI) is driven by coevolving processes. This paper examines the coevolution of dynamic integration strategy and network reconstruction and explores how these processes systematically enable emerging market acquirers to upgrade innovation capabilities.Design/methodology/approach This paper conducts a multi-case study based on four Chinese overseas acquisitions of manufacturing firms. The data were collected from interviews and archival documentation.Findings This study develops a coevolutionary framework of dynamic integration strategy and network reconstruction to explain processes and mechanisms of an acquirer’s innovation capability upgrading. This framework identifies three network motivations, namely, network access, network connection and network synergy. Under different network motivations, dynamic transitions of the acquirer’s integration strategy coevolve with multi-level reconstruction of its networks. Collectively, they are important mechanisms driving innovation capability moves from imitation innovation to asportation and reimitation innovation and then to independent innovation.Originality/valueThis paper responds to a recent call for more insights into the dynamics of PMI and contributes to the research on emerging market multinational corporations’ post-acquisition integration. By integrating the M&A and networks literature, the paper provides evidence of unexplored mechanism of network changes during PMI. It reveals that how acquirers manage the dynamics of PMI to gradually achieve multi-level reconstruction of their networks. Based on a coevolutionary framework, the paper provides a process perspective on how the coevolution of PMI and network reconstruction promotes the upgrading of innovation capabilities.

Purpose This paper aims to investigate whether executive compensation and internal control can prevent overseas compliance risks through the mediating influence of multinational corporation (MNC) legitimacy and the moderating role of institutional distance. Design/methodology/approach Based on a law and economics perspective and the “bad apple,” the “red barrel” and the “bad cellar” theory of business misconduct, this paper constructs a systematic framework of “compliance motivation MNC legitimacy overseas compliance risk prevention” from the individual, organizational and systematic levels and uses data of Chinese MNCs for empirical analysis. Findings Empirical data from Chinese MNCs show that overseas compliance risks are comprehensively affected by the factors of the individual, organizational and systematic levels. Higher executive compensation and internal control will reduce MNCs’ overseas compliance risks through MNC legitimacy acquisition; institutional distance hinders the positive effect of internal control on MNC legitimacy and therefore aggravates overseas compliance risks. Practical implications This paper contributes to the understanding of the overseas law-abiding and offence behavior of MNCs from a law and economics perspective and offers valuable insights on how to prevent the ever-increasing overseas compliance risks. Originality/value Although the literature has analyzed the factors of compliance behavior, they are not interrelated, let alone integrated in a systematic risk prevention framework. This paper applies a law and economic analysis framework to the study of the overseas compliance risks for the first time.