Investigating the deal making failure in M&amp;A: deal makers’ perspective in Brazil

Sales, Augusto; Zanini, Marco Tulio

doi:10.1016/j.rausp.2016.11.002

Cited by 2 publications

(3 citation statements)

References 6 publications

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“…However, Brazil still has a complicated economic, social, cultural and institutional environment, making it difficult to conduct business activities. The taxation system is complex and one of the highest globally (Sales and Zanini, 2017). Brazilian M&As have seen ups and downs in the last two decades.…”

Section: Literature and Hypothesis Developmentmentioning

confidence: 99%

Domestic, inbound and outbound M&A activity interdependence in Brazil

Kumar

Saikia

Mundi

2022

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PurposeMergers and acquisitions (M&As) are of three types: domestic, inbound and outbound cross-border. Inbound M&As provide an inflow of foreign funds into the economy, whereas outbound M&As involve the outflow of domestic funds. This paper examines the impact of domestic and cross-border mergers and acquisitions in Brazil on each other.Design/methodology/approachThe authors analyze M&A activity in Brazil and examine the impact domestic, inbound and outbound M&As have on each other. The study uses a vector auto-regressive model to test the relationships for each quarter of 2000–2018. The M&A activity is operationalized using the total number of deals and the cumulative value of the deals in a particular period.FindingsThe results depict stark contrast for M&A activity measured through incidences and monetary value. Overall, the number of deals can better explain each other than value. The authors find that, in terms of incidences, domestic M&A is Granger caused by both outbound and inbound M&As together. Further, inbound and domestic M&As together Granger cause outbound M&As in terms of aggregate monetary value. The impulse response function reveals that incidence shocks created in M&A activity are longer lasting than the value shocks.Practical implicationsThe results have implications for businesses and policymakers. The study reveals the complexities of crowding effects important for businesses. The government needs to structure its future investment-promotion strategies depending on the objectives related to the number and value of M&A activity.Originality/valueThe study uses econometric tools and empirical methods to find the unexplored nature of the relationship between domestic, outbound and inbound cross-border M&As.

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Section: Literature and Hypothesis Developmentmentioning

confidence: 99%

Domestic, inbound and outbound M&A activity interdependence in Brazil

Kumar

Saikia

Mundi

2022

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“…However, in practice, keeping the balance between control and autonomy or freedom is precarious or paradoxical task (Thelission et al, 2019;Tabesh and Vera, 2020). Thus, PMI is a complicated process, which tends to develop its own trajectory and often leads to very different outcomes than those intendedeven, in the worst case, to the complete failure of a merger (Edwards and Edwards, 2015;Graebner et al, 2017;Meyer and Altenborg, 2007;Sales and Zanini, 2017). In this context, organizational culture has been identified as a major factor in the development of the PMI process.…”

Section: 7mentioning

confidence: 99%

“…Thus, PMI is a complicated process, which tends to develop its own trajectory and often leads to very different outcomes than those intended – even, in the worst case, to the complete failure of a merger (Edwards and Edwards, 2015; Graebner et al. , 2017; Meyer and Altenborg, 2007; Sales and Zanini, 2017). In this context, organizational culture has been identified as a major factor in the development of the PMI process.…”

Section: Literature Review: the Role Of Culture In Pmimentioning

confidence: 99%

From play to pay: a multifunctional approach to the role of culture in post-merger integration

Sales

Roth

Grothe‐Hammer

et al. 2021

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PurposeThe literature on Mergers and Acquisitions (M&A), cultural differences between organizations have frequently been identified as one of the main challenges in the process of post-merger integration (PMI). Existing research has explored a broad variety of cultural differences in perceptions, such as those relating to expectations, norms, values and beliefs within the respective organizations, and how these affect the process and success of PMI. However, less attention has been paid to the relevance of the macro-societal context to PMI. The ambition of this article is, therefore, to advance our understanding of how macro-level societal factors define organizational cultures and affect the success of PMI.Design/methodology/approachWe draw on social systems theory as devised by Niklas Luhmann, assuming that organizations are always embedded in the macro-level societal context of distinctive realms of social reality—such as the economy, politics, religion and the arts—that make up the so-called “function systems”. Looking at the case of the integration of a Brazilian technology start-up into a market-leading corporation, we analyze the dominant orientations towards these function systems, and the changes in these orientations over time.FindingsThe results suggest that differences in organizational culture in PMI can be partly explained by differences in orientations to the function systems. Moreover, forcing dramatic changes of orientations towards the function systems within a merged entity can severely damage its raison d'etre in the first place, potentially leading to, in some sense, an account of “culture murder”.Originality/valueThis article is unique in demonstrating that organizations are multifunctional systems whose culture is defined by the highly specific and potentially varying degrees of importance they place on individual function systems and that knowledge or neglect of these functional profiles may seriously affect the success of post-merger integration. Against this backdrop, the article presents a multifunctional profiling method that may easily translate into PMI management tools.

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Investigating the deal making failure in M&A: deal makers’ perspective in Brazil

Cited by 2 publications

References 6 publications

Domestic, inbound and outbound M&A activity interdependence in Brazil

Domestic, inbound and outbound M&A activity interdependence in Brazil

From play to pay: a multifunctional approach to the role of culture in post-merger integration

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