New perspective for the management of M&A process: a merger case of a Japanese pharmaceutical company

New perspective for the management of M&A process: a merger case of a Japanese pharmaceutical... Purpose – The purpose of this study is to provide a new perspective for effective management of the merger and acquisition (M&A) process by making use of a case study of a merger in the Japanese pharmaceutical industry. As corporate governance and culture are notably employee‐oriented in Japanese firms, the paper seeks to explore whether M&As in the industry may follow different paths from those in Western companies and lead to competitive advantage. Design/methodology/approach – The paper examines the case of a merger of a Japanese pharmaceutical company, Astellas Pharma, which was formed as a result of one of the largest M&As in Japanese M&A history. The case is analyzed in line with previous theories on M&A process management. Findings – The case was characterized by a strong momentum created by a core merger team consisting of a few members of management and workforce representatives, and the merger process was facilitated by both top‐down leadership and ground‐level support from the workforce. While broad engagement and non‐rapid rationalization of the workforce can slow the execution of the merger process and delay efficiency savings, it can also consistently drive the merger process and place the merged firm on a solid foundation with strong commitment from all levels. Originality/value – This study suggests a new mode of the M&A process by focusing on a particular merger case of a Japanese pharmaceutical company. The mechanisms observed in the case should be applied with appropriate modifications to the M&As of Western companies. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Corporate Governance Emerald Publishing

New perspective for the management of M&A process: a merger case of a Japanese pharmaceutical company

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Publisher
Emerald Publishing
Copyright
Copyright © 2011 Emerald Group Publishing Limited. All rights reserved.
ISSN
1472-0701
DOI
10.1108/14720701111108862
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this study is to provide a new perspective for effective management of the merger and acquisition (M&A) process by making use of a case study of a merger in the Japanese pharmaceutical industry. As corporate governance and culture are notably employee‐oriented in Japanese firms, the paper seeks to explore whether M&As in the industry may follow different paths from those in Western companies and lead to competitive advantage. Design/methodology/approach – The paper examines the case of a merger of a Japanese pharmaceutical company, Astellas Pharma, which was formed as a result of one of the largest M&As in Japanese M&A history. The case is analyzed in line with previous theories on M&A process management. Findings – The case was characterized by a strong momentum created by a core merger team consisting of a few members of management and workforce representatives, and the merger process was facilitated by both top‐down leadership and ground‐level support from the workforce. While broad engagement and non‐rapid rationalization of the workforce can slow the execution of the merger process and delay efficiency savings, it can also consistently drive the merger process and place the merged firm on a solid foundation with strong commitment from all levels. Originality/value – This study suggests a new mode of the M&A process by focusing on a particular merger case of a Japanese pharmaceutical company. The mechanisms observed in the case should be applied with appropriate modifications to the M&As of Western companies.

Journal

Corporate GovernanceEmerald Publishing

Published: Feb 22, 2011

Keywords: Acquisitions and mergers; Pharmaceuticals industry; Japan

References

  • The influence of corporate acquisitions on the behaviour of key inventors
    Ernst, H.; Vitt, J.

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