Cross-border acquisition abandonment and completion: The effect of institutional differences and organizational learning in the international business service industry, 1981–2001

Dikova, Desislava; Sahib, Padma Rao; Witteloostuijn, A. van

doi:10.1057/jibs.2009.10

Cited by 426 publications

(600 citation statements)

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“…Unlike most previous studies that simplify institutional distance as a single variable hindering assorted cross-border activities, such as foreign entry mode choices (Yiu & Makino, 2002), partner selection of international alliances (Li & Ferreira, 2008), and the performance of cross-border acquisitions (Dikova, Sahib, & van Witteloostuijn, 2010), we highlight the formative nature of institutional distance in this study, because it is measured by Bthe extent of similarity or dissimilarity between the regulatory, normative, and cognitive institutions of two countries^ (Kostova, 1996). Regulatory institutions refer to political environments, including laws and regulations that construct and constitute the grounds of organizational and industrial actions and ensure stability and order in societies (North, 1990;Scott & Meyer, 1994).…”

Section: Theory and Hypothesesmentioning

confidence: 99%

Institutional distance and knowledge acquisition in international buyer-supplier relationships: The moderating role of trust

Ghauri

Larimo

2017

Asia Pac J Manag

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Institutional distance can generate expanded opportunities for multinational firms to facilitate learning and responsiveness. However, such distance can also create obstacles regarding knowledge transfer and integration. A theoretical puzzle concerns the mechanisms and conditions in which international buyers and suppliers can overcome institutional distance and acquire new knowledge. We develop an integrative moderated-mediation model in which institutional distance prevents parties from accessing knowledge but, when knowledge is obtained and mutual trust is developed, it promotes cross-border knowledge acquisition in international buyer-supplier exchange, particularly between international firms and firms from the Asia Pacific region. These findings indicate that firms can overcome the challenges of regulative and cognitive distance and facilitate access to knowledge and knowledge acquisition when they are able to develop and cultivate relationships of mutual trust with foreign partners. While normative distance may create learning incentives and opportunities in international buyer-supplier relationships, its impacts on knowledge accessibility and acquisition are insignificant.

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Section: Theory and Hypothesesmentioning

confidence: 99%

Institutional distance and knowledge acquisition in international buyer-supplier relationships: The moderating role of trust

Ghauri

Larimo

2017

Asia Pac J Manag

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“…Economic nationalism is a crucial aspect of the home country's institutions (Beland & Lecours, 2005), which can greatly facilitate or constrain foreign investors' FDI (Dikova, Sahib & Witteloostuijn, 2010). 7 North (1990) defines institutions as the humanly devised constrains that structure human interaction, and include both informal (e.g.…”

Section: Theoretical Framework and Hypothesismentioning

confidence: 99%

“…The current study focuses on the impact of government-level nationalism as reflected by its policies, paralleling North's formal institutions, and Scott's regulative institutions. This set of institutions is key discriminating factors of FDI success (Dikova, Sahib & Witteloostuijn, 2010).…”

Section: Theoretical Framework and Hypothesismentioning

confidence: 99%

“…Recent development suggests that a firm's international expansion is also enabled and constrained by the different institutions under which it operates (Buckley, Clegg, Cross, Liu, Voss & Zheng, 2007;Hoskisson, Eden & Wright, 2000;Meyer & Peng, 2005;Mudambi & Navarra, 2002;Peng, 2002Peng, & 2003Wright, Filatotchev, Hoskisson & Peng, 2005;Peng, Wang & Jiang 2008). In this line a few studies have examined the impact of institutions on cross-border acquisition, such as industrial regulatory factors (Muehlfeld, Sahib, & Witteloostuijn, 2007), institutional quality of hosts (Zhang, Zhou & Ebbers, 2011), and institutional distance (Dikova, Sahib & Witteloostuijn, 2010).…”

Section: Introductionmentioning

confidence: 99%

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Economic nationalism and foreign acquisition completion: The case of China

Zhang

2014

International Business Review

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The full-text may be used and/or reproduced, and given to third parties in any format or medium, without prior permission or charge, for personal research or study, educational, or not-for-pro t purposes provided that:• a full bibliographic reference is made to the original source • a link is made to the metadata record in DRO • the full-text is not changed in any way The full-text must not be sold in any format or medium without the formal permission of the copyright holders.Please consult the full DRO policy for further details. Abstract: Extending institutional theory, we incorporate a neglected but important component of formal institution, economic nationalism, into a model that specifies its effects on cross-border acquisition success. We suggest that economic nationalism has a dynamic nature and sees the interaction between protectionism and liberalism. As such, it exerts both positive and negative effects on foreign investments, contingent on how these investments are perceived as aligned with the national interests as reflected by national security considerations, foreign relations, and growth strategy. Using a data set containing 7,275 announced cross-border acquisition deals in China during 1985-2010, the study finds that (1) when an acquisition activity targets essential industries or state-owned enterprises, it is less likely to be completed because of provoked national economic security concerns; and (2) when an acquirer brings technology and/or capital, or/and helps to restructure poorly-performing firms, or/and the acquirer comes from a country with good foreign relations with China, the acquisition is considered as safe and helpful for the country's development, and it is more likely to be completed.

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“…Over the years, the focus moved to the resource-based view and the organizational learning perspective (Barkema & Vermeulen, 1998). Institutional-and sociocultural-based theories, which analyze the impact of cultural distance, regulatory differences, and institutional contingencies on corporate restructuring events, are increasingly numerous nowadays (Dikova, Sahib, & Witteloostuijn, 2010;Gubbi, Aulakh, Ray, Sarkar, & Chittoor, 2010;Lin, Peng, Yang, & Sun, 2009;Nadolska & Barkema, 2007;Reus & Lamont, 2009), as more traditional analyses focusing on financial-economic and market aspects have proved insufficient to apprehend the entire complexity inherent to a cross-border acquisition (King, Dalton, Daily, & Covin, 2004).…”

Section: Introductionmentioning

confidence: 99%

Desempenho de fusões e aquisições cross border: análise empírica do caso brasileiro

Bortoluzzo

Garcia²,

Boehe

et al. 2014

Rev. adm. empres.

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Desempenho de fusões e aquisições cross border: análise empírica do caso brasileiro Desempeño de fusiones y adquisiciones cross border: análisis empírico del caso brasileño ABSTRACTThe purpose of this article is to investigate whether the cross-border acquisitions made by Brazilian companies over the past 15 years have improved their financial performance. Drawing on institutional, sociocultural, and organizational learning theories, this study develops and empirically tests several hypotheses on the determinants of M&A performance. The results demonstrate that the cross-border acquisition moves by Brazilian companies actually improve their financial performance. Financial performance tends to be positive when the cultural distance between the countries of the acquiring and acquired companies is low to medium and when the institutional context of the acquired company is a developed one. We also found an inverted-U shape relationship between acquiring companies' previous international M&A experience and the performance of a new cross-border operation. These findings suggest that research on international M&As should include acquirers' M&A experience as well as the institutional characteristics of their target countries. KEYWORDS | Cross-border M&A, internationalization, financial performance, institutional theory, organizational learning. RESUMO Este artigo tem como objetivo investigar se as aquisições realizadas por empresas brasileiras fora do País nos últimos 15 anos têm aumentado o desempenho financeiro dessas empresas. Além disso, é realizada uma análise empírica dos fatores determinantes desse sucesso, com base nas teorias institucional, sociocultural e de aprendizagem organizacional. Os resultados indicam que, de fato, as investidas cross border de companhias do Brasil melhoram o desempenho, que é positivamente impactado quando a distância cultural entre os países da adquirida e da adquirente é baixa ou média e quando o ambiente institucional no qual a empresa-alvo se encontra é desenvolvido. Já a relação entre as experiências anteriores das brasileiras em fusões ou aquisições internacionais e o desempenho de uma nova aquisição fora do País segue o formato de U invertido, enfatizando a relevância de se considerar a experiência com fusões e aquisições da empresa compradora além das características institucionais dos seus países-alvo. PALAVRAS-CHAVE | Fusões e aquisições cross border, internacionalização, desempenho financeiro, teoria institucional, aprendizagem organizacional. RESUMEN Este artículo tiene como objetivo investigar si las adquisiciones realizadas por empresas brasileñas fuera del País en los últimos RAE-Revista de Administração de Empresas | FGV-EAESP

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Cross-border acquisition abandonment and completion: The effect of institutional differences and organizational learning in the international business service industry, 1981–2001

Cited by 426 publications

References 48 publications

Institutional distance and knowledge acquisition in international buyer-supplier relationships: The moderating role of trust

Institutional distance and knowledge acquisition in international buyer-supplier relationships: The moderating role of trust

Economic nationalism and foreign acquisition completion: The case of China

Desempenho de fusões e aquisições cross border: análise empírica do caso brasileiro

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