Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

Chinese cross‐border mergers and acquisitions: strategic types, organizational factors and enterprise growth

Chinese cross‐border mergers and acquisitions: strategic types, organizational factors and... Purpose – This paper aims to investigate the relationships between the strategic type of cross‐border mergers and acquisitions (M&As) and enterprise growth, and the moderating role of Chinese companies' organizational factors, including organizational structure, organizational experience, cultural distance and relative size. Design/methodology/approach – The authors, as researchers, have mixed the strategic choice and post‐M&As integration into a comprehensive framework while building the theoretical model of “Strategic Type of Cross‐border M&As‐Organizational Factors‐Enterprise Growth” (ST‐OF‐EG). In this paper, they have empirically examined the model using hierarchical regression by analyzing 76 cross‐borders M&A events of overseas‐listed Chinese companies over the 2000‐2007 period. Findings – The analysis shows that: related cross‐border M&As are better for enterprise growth than unrelated diversification cross‐border M&As; and among the organizational factors, studied organizational structure and organizational experience show a positive significance in terms of the relationship between the strategic type of cross‐border M&As and enterprise growth. The moderating role of cultural distance and relative size is non‐significant. Research limitations/implications – In this paper, the moderating effect of cultural distance was found to be insignificant. However, further research is encouraged. Practical implications – Chinese companies should pay attention to strategic choices before cross‐border M&As. They should expand abroad to markets step by step. They should merge the companies that have the higher relevance on a product, industry or market first. On the basis of specialization, Chinese companies should make themselves stronger and then develop from specialization to proper diversification, which is a robust path to achieve enterprise growth. Besides, Chinese companies should accumulate international experience as soon as possible and organizational structure should match the strategic choice. Originality/value – This paper would be immensely helpful to Chinese companies to plan their cross‐border M&As strategy in a way that would enhance growth and core‐competence. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Asia Business Studies Emerald Publishing

Chinese cross‐border mergers and acquisitions: strategic types, organizational factors and enterprise growth

Download PDF
14 pages

Loading next page...
 
/lp/emerald-publishing/chinese-cross-border-mergers-and-acquisitions-strategic-types-8QabjxzPiX
Publisher
Emerald Publishing
Copyright
Copyright © 2013 Emerald Group Publishing Limited. All rights reserved.
ISSN
1558-7894
DOI
10.1108/15587891311319459
Publisher site
See Article on Publisher Site

Abstract

Purpose – This paper aims to investigate the relationships between the strategic type of cross‐border mergers and acquisitions (M&As) and enterprise growth, and the moderating role of Chinese companies' organizational factors, including organizational structure, organizational experience, cultural distance and relative size. Design/methodology/approach – The authors, as researchers, have mixed the strategic choice and post‐M&As integration into a comprehensive framework while building the theoretical model of “Strategic Type of Cross‐border M&As‐Organizational Factors‐Enterprise Growth” (ST‐OF‐EG). In this paper, they have empirically examined the model using hierarchical regression by analyzing 76 cross‐borders M&A events of overseas‐listed Chinese companies over the 2000‐2007 period. Findings – The analysis shows that: related cross‐border M&As are better for enterprise growth than unrelated diversification cross‐border M&As; and among the organizational factors, studied organizational structure and organizational experience show a positive significance in terms of the relationship between the strategic type of cross‐border M&As and enterprise growth. The moderating role of cultural distance and relative size is non‐significant. Research limitations/implications – In this paper, the moderating effect of cultural distance was found to be insignificant. However, further research is encouraged. Practical implications – Chinese companies should pay attention to strategic choices before cross‐border M&As. They should expand abroad to markets step by step. They should merge the companies that have the higher relevance on a product, industry or market first. On the basis of specialization, Chinese companies should make themselves stronger and then develop from specialization to proper diversification, which is a robust path to achieve enterprise growth. Besides, Chinese companies should accumulate international experience as soon as possible and organizational structure should match the strategic choice. Originality/value – This paper would be immensely helpful to Chinese companies to plan their cross‐border M&As strategy in a way that would enhance growth and core‐competence.

Journal

Journal of Asia Business Studies – Emerald Publishing

Published: Apr 26, 2013

Keywords: Enterprise growth; Strategic type of cross‐border M&As; Post‐M&As integration; Organizational factors; Acquisitions and mergers; Business enterprise; China

References

  • Towards a theory of new venture growth
    Ardishvili, A.
  • International expansion through start‐up or acquisition: a learning perspective
    Barkema, H.G.; Vermeulen, F.
  • Diversification's effect on firm value
    Berger, P.G.; Ofek, E.
  • Does M&A pay? A survey of evidence for the decision‐maker
    Buhner, R.
  • Sources of value in takeovers: synergy or restructuring: implications for target and bidder companies
    Chatterjee, S.
  • Relative standing: a framework for understanding departures of acquired executives
    Hambrick, D.C.; Cannella, A.A. Jr
  • Acquisition strategy and the market position of acquiring firm
    Hopkins, H.D.
  • Meta‐analysis of post‐acquisition performance: indication of unidentified moderators
    King, D.R.; Dalton, D.R.; Daily, C.M.; Covin, J.C.
  • National cultural distance and cross‐border acquisition performance
    Morosini, P.; Shane, S.; Singh, H.
  • Challenges for internationalization process theory: the case of international new ventures
    Oviatt, B.M.; McDougall, P.P.
  • The role of broader context and the communication program in merger and acquisition implementation success
    Papadakis Vassilis, M.
  • Can diversification M&As create value for shareholders?
    Shanmin‐Li, T.‐Z.
  • Theoretical foundations of cross‐border mergers and acquisitions: a review of current research and recommendations for the future
    Shimizu, K.; Hitt, M.A.; Vaidyanath, D.; Pisano, V.
  • The capitalists team and the growth of entrepreneurial enterprise
    Xiaogang‐He; Yu‐Shen