Management Research, vol. 7, no. 1 (Winter 2008–9), pp. 21–32.
© 2009 M.E.Sharpe, Inc. All rights reserved.
ISSN 1536-5433 / 2009 $9.50 + 0.00.
Business growth has been one of the most studied topics in
management studies since the late 1950s. From a manage-
ment approach, growth can be explained in strategic terms,
and a company’s growth mode is the result of a management
decision-making process. When choosing a growth mode,
a company decides ﬁ rst between internal or noninternal (or
external) growth. If management chooses noninternal growth,
they must then decide whether to pursue mergers/acquisitions
or joint ventures.
In this work, we focus on noninternal growth modes. Stra-
tegic alliances and mergers and acquisitions enable ﬁ rms to
increase their market power, enter new markets, and combine
or gain access to new resources and capabilities (Das & Teng,
2000; Porrini, 2004). With organizational, technological, and
managerial change taking place ever more rapidly, ﬁ rms cannot
develop internally all of the resources they need to grow and
improve their competitive advantages. Thus, growth modes
that allow access to resources and capabilities of other com-
panies play an important role (Hagedoorn & Duysters, 2002).
Cooperative agreements (mainly, joint ventures) and mergers/
acquisitions can be an attractive alternative to purchasing
resources and capabilities in the market, which have higher
transaction costs (Balakrishnan & Koza, 1993; Hennart &
Reddy, 1997). Although both acquisitions and joint ventures
offer access to resources that the company does not have, they
differ in how they affect the company’s performance (Hoffmann
& Schaper-Rinkel, 2001). Therefore, ﬁ rms must analyze and
understand the decision-making process in order to select
the external growth mode, mergers/acquisitions or coopera-
tive agreements, best suited to improving their competitive
advantages and the results (Mayrhofer, 2004; Vanhaverbeke,
Duysters, & Noorderhaven, 2002).
One of the main areas of research on growth modes is to
compare different growth modes and identify the factors that
determine why one mode is chosen over another (Hagedoorn
Ángeles Montoro-Sanchez (email@example.com) is an associate
professor of management at the Complutense University of Madrid
(Spain). She received her Ph.D. in business administration from the
Complutense University of Madrid in 2000. Her research interest
includes strategic alliances, cooperative agreements, mergers and
acquisitions, and entrepreneurship.
Marta Ortiz-de-Urbina-Criado (firstname.lastname@example.org) is
an assistant professor of management at Rey Juan Carlos University
(Madrid, Spain). She received her Ph.D. in business administration
from the Rey Juan Carlos University. Her research interest includes
strategic alliances, mergers and acquisitions, diversiﬁ cation, and
This paper was supported by Real Colegio Complutense at Harvard
University, Projects SEJ2005-08805 and CCG07-UCM/HUM-2966,
Cátedra Bancaja-Universidad Complutense de Madrid Jóvenes Em-
prendedores, and Cátedra Iberdrola Universidad Rey Juan Carlos.
DECIDING BETWEEN ACQUISITION AND JOINT VENTURE
Intangible Resources and Similarity
ÁNGELES MONTORO-SANCHEZ AND MARTA ORTIZ-DE-URBINA-CRIADO
ABSTRACT: The aim of this paper is to analyze the inﬂ uence of intangible assets and similarity of resources on the choice
between acquisitions and joint ventures and whether it is different in domestic and European operations. In order to test
these relations, a sample of domestic and European growth deals was selected (563 deals, of which 449 are acquisitions
and 114 are joint ventures). Results demonstrate that it is more probable that ﬁ rms will choose acquisitions if there is a
close similarity between the resources of the ﬁ rms. Also, if the operation is domestic, companies with higher proportions
of intangible resources prefer acquisitions.
RESUMEN: El objetivo principal de este trabajo es analizar la inﬂ uencia de los activos intangibles y de la similitud entre
los recursos de las empresas en la elección entre adquisiciones y empresas conjuntas, diferenciando entre operaciones do-
mésticas y europeas. Para realizar este análisis se ha seleccionado una muestra de 563 operaciones europeas y domésticas,
de las cuales 449 son adquisiciones y 114 son empresas conjuntas. Los resultados han mostrado que, cuando los recursos
de las empresas tienen un alto grado de similitud, las empresas son más propensas a adquirir que a establecer empresas
conjuntas. También se ha obtenido que, en el caso de las operaciones domésticas, las empresas que tienen mayores propor-
ciones de activos intangibles preﬁ eren las adquisiciones.