cross border mergers and acquisitions dissertation

Cross-border Mergers and Acquisitions: The Case of Merger Control v. Merger Deregulation

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During the last century, not only the legal literature but also the literature in many fields along with government efforts on all levels, were all mainly devoted to the debate of trade liberalization in general, and specifically to the case of the expected gains from using international agreements as a tool to remove the trade barriers. Meanwhile, all the parties have paid little attention to profound questions about identifying the impediments that they are facing and the other possible options that might maximize the general welfare, which are the cross-border merger and acquisition transactions.

This dissertation will address that under-researched question, and it will try to identify some of those impediments that are facing the cross-border merger and acquisition transactions. The dissertation will mainly focus on the different premerger control laws that are adopted around the globe, as an impediment that faces the cross-border mergers and acquisitions, and it will try to identify the drawbacks of those laws and most importantly develop and examine reforming proposals.

The underlying result of this dissertation will reveal that the multijurisdictional premerger control laws across the globe have numerous drawbacks that are actual impediments that face mergers and acquisitions in general, and especially the cross-border transactions. In addition to that, the best reformative option is the abolishing of the premerger control laws, or in other words the deregulation of the cross-border merger and acquisition transactions.

The conclusion of this dissertation is that using the law as a useful tool should be reinvented on two dimensions, at one end of the spectrum the law should enable the state possibilities that are required to give a hand and facilitate the entry to markets, by abolishing the premerger control laws i.e. deregulating mergers and acquisitions, and at the other end of the spectrum the law should grant the state the power to monitor and challenge those practices that might cause harm to employees or consumers, before the courts, along with the primary power to challenge anticompetitive behaviors.

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Three Decades of Cross-Border Mergers and Acquisitions Research: Mapping the Field and Paths Forward

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Cross-Border Mergers and Acquisitions

One of the most consequential events in any firm’s lifetime is a major acquisition. Because of their importance, mergers and acquisitions (M&As) have been an enormous area of research. However, the vast majority of this research and survey papers summarizing this research have focused on domestic deals. Cross-border ones, however, constitute about 30% of the total number and 37% of the total volume of M&As around the world since the early 1990s. We survey the literature on cross-border M&As, focusing on international factors that can lead firms to acquire a firm in another country. Such factors include differences in economic development, laws, institutions, culture, labor rights, protection of intellectual property, taxes, and corporate governance.

We thank Eduard Inozemtsev, Sejin Kang, Daisy Wang, and Grace Zhang for excellent research assistance, Rose Liao for help with computations, and Jeff Netter and René Stulz for helpful suggestions. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.

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The Global Diffusion of Antitrust and Merger Control and Its Impact on Cross-Border Mergers and Acquisitions

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Dissertations / Theses on the topic 'Cross-border Merger and Acquisition'

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Partin, Jonatan, Matilda Andersson-Thunberg, and Tobias Fjellman. "How management creates and realizes synergy : Cross-border merger & acquisitions." Thesis, Jönköping University, Jönköping International Business School, 2008. http://urn.kb.se/resolve?urn=urn:nbn:se:hj:diva-9.

Mergers and Acquisitions (M&A) have been around for a long time and has experienced waves of popularity during these times and they are very much an important part of today’s business world. M&As have also become increasingly international which can be due to the rising global competition. The popularity of cross-border M&As makes it important to look at M&As from an international perspective. One of the main reasons a company choose to M&A is growth (Lees, 2003) and there are several possible motives why a company chooses to grow through an M&A but the most common motive is to create synergy (DePhamphilis, 2005). Although synergy is one motive, according to the literature more M&As destroy value instead of creating it (Habeck, et al. 2000). This makes this subject interesting to study: especially the post-M&A phase since the integration process in this phase has been pointed out to be the riskiest, when creating synergy, but also the most crucial in order for a successful M&A (Habeck, et al. 2000; Shaver, 2006).

The purpose of this thesis is to analyze how the management of a company create and realize synergies in the post-M&A process of a cross-border M&A.

In order to fulfil the purpose the case study approach was chosen. The empirical data was gathered through semi-structured face-to–face (except two telephone) interviews. This approach was used because the information needed to fulfil the purpose was of the character to be found in a qualitative way by going in-depth into the field of interest with a management team with extensive knowledge in this subject.

Conclusion:

Creating and realizing synergies is a long process on average 5-10 years. There is no manual for the M&A process only a general approach and each M&A process is customized. It was found that one cannot separate the pre-deal phase from the post-phase. An M&A process includes three different important parts; the strategic intent phase, the due diligence phase, and finally the integration phase. Key success factors for conducting an M&A are that you set up a special management group which will focus on the creation and realisation of synergies and that one focus on motivating and assisting managers through offer new exiting challenges.

Ji, Xiaoxuan. "Tax Competition for Foreign Direct Investment: A Study of Greenfield Investment and Cross-border Merger and Acquisition." OpenSIUC, 2019. https://opensiuc.lib.siu.edu/dissertations/1660.

Liu, Qing, and 刘青. "Essays on multinational firms: export, FDI, and cross-border acquisitions." Thesis, The University of Hong Kong (Pokfulam, Hong Kong), 2010. http://hub.hku.hk/bib/B45151143.

Karst, Rusty V. "Semiglobalization: Institutional Effects on Multilatina Cross-Border Acquisitions." Thesis, University of North Texas, 2016. https://digital.library.unt.edu/ark:/67531/metadc849693/.

Laneve, Marc, and Thomas Stüllein. "The influence of national culture on cross-border M&A." Thesis, Linnaeus University, Linnaeus School of Business and Economics, 2010. http://urn.kb.se/resolve?urn=urn:nbn:se:lnu:diva-5780.

In theory, the phrase "mergers and acquisitions" (abbreviated M&A) refers to buying, selling and combining different companies in order to gain improved financial performance, create a global presence, and face the global competitive market. Nevertheless, many researches have underlined the high rate of failure among M&A, and the difficulty to achieve expected results and synergies. Among the reasons of failure, many analysts have pointed out the determinant influence of the cultural aspect in the success or the failure of a cross-border merger. However, the cultural issue in M&A is often neglected and too less stressed.

In order to have a better understanding of the cultural aspect in the merger and acquisition process, and point out its influence on the merger process as well as the corporate culture, we first present a theoretical part introducing the cross-border merger and acquisition concept with the perspective of the national culture, and the role that leaders could play in order to limit the negative impact of culture and the clashes on cross-border M&A. Therefore, a part including three cases of "cultural failure" in the merger process illustrates the concepts explained in the theoretical part. Those well-known cases are: DaimlerChrysler, UpJohn & Pharmacia, and Volvo – Renault. The cases show how the cultural issue had been underestimated and had implied cultural clashes and extra-costs for the companies involved.

After concluding our findings, we end the thesis with a prospective part based on the possible evolution of the merger and acquisition market. Indeed, we believe that our research topic will gain importance in the future, and the influence of culture on M&A deals may increase.

Thomas, Ashley Anne. "Balancing power through the market government intervention in cross-border mergers & acquisitions /." Connect to Electronic Thesis (CONTENTdm), 2009. http://worldcat.org/oclc/454140048/viewonline.

Punurai, Somrat. "Determinants of Outbound Cross-border Mergers and Acquisitions by Emerging Asian Acquirers." Thesis, University of North Texas, 2014. https://digital.library.unt.edu/ark:/67531/metadc700107/.

Forslund, Filip, and Jesper Sommar. "Lesson learned? : The utilization of learning in cross-border M&A integration." Thesis, Umeå universitet, Företagsekonomi, 2018. http://urn.kb.se/resolve?urn=urn:nbn:se:umu:diva-150954.

Adel, Nour. "Evaluating and analyzing firms' investment decisions : a study of UK domestic and cross-border acquisitions." Thesis, Brunel University, 2011. http://bura.brunel.ac.uk/handle/2438/5298.

Eiler, Lisa Ann. "Accounting disclosure quality and synergy gains : evidence from cross-border mergers and acquisitions /." Thesis, Connect to title online (Scholars' Bank) Connect to title online (ProQuest), 2009. http://hdl.handle.net/1794/10203.

Beusch, Peter. "Contradicting management control ideologies : a study of integration processes following cross-border acquisitions of large multinationals /." Göteborg : BAS Publ, 2007. http://www.gbv.de/dms/zbw/548620407.pdf.

Stander, Gideon Stefan. "The cultural impact of cross–border acquisitions on the accounting function : a case study / Gideon Stefan Stander." Thesis, North-West University, 2010. http://hdl.handle.net/10394/4593.

Bindabel, Wardah Abdulrahman. "The influence of Shariah (Islamic principles) corporate governance on cross-border merger and acquisitions involving Islamic companies in the Gulf countries." Thesis, De Montfort University, 2017. http://hdl.handle.net/2086/14468.

Stahl, Günter, Chei Hwee Chua, and Amy L. Pablo. "Does National Context Affect Target Firm Employees' Trust in Acquisitions? A Policy-Capturing Study." Springer, 2012. http://epub.wu.ac.at/3613/1/MIR_%2D_Employee_Reactions_to_Takeovers_(Final__April_23_2011).pdf.

Shin, Inhye. "Factors influencing the cooperative process of cross-border merger and acquisitions negotiation in face-to-face : the role of individual, strategic, and contextual components." Thesis, King's College London (University of London), 2014. https://kclpure.kcl.ac.uk/portal/en/theses/factors-influencing-the-cooperative-process-of-crossborder-merger-and-acquisitions-negotiation-in-facetoface(002c197c-c9d3-46fd-a6d4-6ce38a3f6352).html.

Šmidová, Dana. "Přeshraniční fúze - řešení v českém a slovenském účetnictví." Master's thesis, Vysoká škola ekonomická v Praze, 2009. http://www.nusl.cz/ntk/nusl-76494.

Sklenár, Roman. "Cezhraničné fúzie -- účtovné riešenie v podmienkach obchodného a daňového práva v ČR a SR." Master's thesis, Vysoká škola ekonomická v Praze, 2008. http://www.nusl.cz/ntk/nusl-10471.

Simpson, Paul. "Modelling UK cross border mergers and acquisitions." Thesis, University of Manchester, 2003. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.488396.

Jenniges, Derrick T. "THREE ESSAYS ON CROSS-BORDER MERGERS AND ACQUISITIONS." UKnowledge, 2014. http://uknowledge.uky.edu/economics_etds/15.

Chen, Yuhuilin. "Three essays on cross-border mergers and acquisitions." Thesis, University of Nottingham, 2017. http://eprints.nottingham.ac.uk/38705/.

Nachemson-Ekwall, Sophie. "An institutional analysis of cross-border hostile takeovers : shareholder value, short-termism and regulatory arbitrage on the Swedish stock market during the sixth takeover wave." Doctoral thesis, Handelshögskolan i Stockholm, Institutionen för Företagande och Ledning, 2012. http://urn.kb.se/resolve?urn=urn:nbn:se:hhs:diva-1907.

Diss. Stockholm : Handelshögskolan, 2012

Li, Haixiang. "Fusions - acquisitions menées par les entreprises multinationales chinoises : motivations et déterminants de la performance : analyse des opérations menées en Europe et en Amérique du Nord (2002-2012)." Thesis, Aix-Marseille, 2016. http://www.theses.fr/2016AIXM2003.

Ayoush, Maha Diab. "Are cross-border mergers and acquisitions better or worse than domestic mergers and acquisitions? : the UK evidence." Thesis, University of Birmingham, 2011. http://etheses.bham.ac.uk//id/eprint/1589/.

Andersson, Maria, and de la Rosa Maja Karlsson. "Cross-border and corporate aspects on culture in mergers and acquisitions." Thesis, Uppsala University, Department of Business Studies, 2006. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-8761.

Wu, Bing. "Changes of shareholder wealth associated with cross-border mergers and acquisitions." Thesis, Aston University, 2017. http://publications.aston.ac.uk/33421/.

Lee, Donghyun, and Donghyun Lee. "Essays on Cross-Border Mergers and Acquisitions, Technology, and Frictional Costs." Thesis, University of Oregon, 2012. http://hdl.handle.net/1794/12435.

Gu, Xuehua. "Trois essais sur les fusions-acquisitions transfrontalières." Thesis, Université Grenoble Alpes (ComUE), 2016. http://www.theses.fr/2016GREAG012/document.

Östlund, Andreas, and Pernilla Lindblad. "Cross-border mergers and acquisitions in the banking sector : A Swedish perspective." Thesis, Umeå University, Umeå School of Business, 2008. http://urn.kb.se/resolve?urn=urn:nbn:se:umu:diva-1846.

Kang, Ji Woong. "Cross-border mergers and acquisitions in Korea : strategic motivations, transition management and competitiveness." Thesis, Royal Holloway, University of London, 2012. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.586614.

Tu, Wenjun. "Cross-border mergers and acquisitions of Chinese firms : an investigation of value creation." Thesis, University of Nottingham, 2017. http://eprints.nottingham.ac.uk/42994/.

Lin, Yupu. "An empirical investigation on firm-level performance of cross border mergers and acquisitions." Thesis, Aston University, 2015. http://publications.aston.ac.uk/27227/.

Demir, Mert. "Cross-border Bank Acquisitions And Company Performance: The Case Of Emerging Markets." Thesis, METU, 2008. http://etd.lib.metu.edu.tr/upload/12609607/index.pdf.

Duarte, Daniel José da Silva. "Corporate tax avoidance followed by mergers and acquisitions." Master's thesis, Instituto Superior de Economia e Gestão, 2016. http://hdl.handle.net/10400.5/13186.

Ezrachi, Ariel. "Regulation of cross border mergers and acquisitions : from unilateral to cooperative competition law enforcement." Thesis, University of Oxford, 2002. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.248887.

Sun, Miao. "Chinese companies' cross-border mergers and acquisitions performance : evidence from inward and outward deals." Thesis, Durham University, 2018. http://etheses.dur.ac.uk/12544/.

Valk, Floris Joost. "Internal capital markets in cross-border mergers and acquisitions; a financial market development perspective." Thesis, Uppsala universitet, Företagsekonomiska institutionen, 2018. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-347196.

Du, Min. "An analysis of acquirers' returns of cross-border mergers and acquisitions by Chinese firms." Thesis, University of Nottingham, 2014. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.659215.

Jedin, Mohd Haniff bin Haniff. "Antecedents and performance outcomes of the marketing integration process in cross-border mergers and acquisitions: the case of Malaysia and Indonesia." Thesis, University of Manchester, 2011. https://www.research.manchester.ac.uk/portal/en/theses/antecedents-and-performance-outcomes-of-the-marketing-integration-process-in-crossborder-mergers-and-acquisitions-the-case-of-malaysia-and-indonesia(e032a315-b99a-4c21-8536-36917361ee2c).html.

Jia, Xufeng [Verfasser], and M. G. [Akademischer Betreuer] Faure. "Do Home Country Institutions Matter in Cross-border Mergers and Acquisitions? / Xufeng Jia ; Betreuer: M.G. Faure." Hamburg : Staats- und Universitätsbibliothek Hamburg, 2019. http://d-nb.info/1189817578/34.

Liao, Chuan. "Essays in International Financial Management." The Ohio State University, 2010. http://rave.ohiolink.edu/etdc/view?acc_num=osu1264946797.

Lameijer, Marloes. "Financial Flexibility, Bidder’s M&A Performance, and the Cross-Border Effect." Thesis, Uppsala universitet, Företagsekonomiska institutionen, 2016. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-277274.

Cao, Vu, and Rusi Li. "A study of cultural differences in cross-border Mergers & Acquisitions : Case studies review in Swedish companies." Thesis, Umeå University, Umeå School of Business, 2010. http://urn.kb.se/resolve?urn=urn:nbn:se:umu:diva-35013.

Among the challenges that companies may face during the post M&A phase, cultural integration can be seen as one of the trickiest tasks. Cultural differences which are inevitable in any deal are always there. The link between how people from autonomous groups live together and the deal result is an interesting topic that needs to be investigated. Since we have an interest in developing the understanding of cultural differences during integration process in cross-border M&As, the research question “How do cultural differences arise in cross-border M&As during the integration process and do they impact the deal result?” is formulated.

This thesis presents a model that demonstrates elements of cultural differences from three levels, national, organizational and personal. In this model, these levels can be seen as interrelated to each other in which the inner layer is impacted by the outer one. As a result, personal culture, as the most inner layer, is doubly impacted by the other two, national and organizational levels. Given that the scope of our thesis is for cross-border M&As, after investigating these three levels of culture, we found that organizational and personal differences are real in any M&As no matter domestic or cross-border deals. Differences at national level, on the contrary, are the first element that should be mentioned as a root of cultural differences in companies from different nationalities.

From the understanding about emergence of cultural differences, we further study to see if they leave any effect on the deal result. In the empirical section, from the cultural gap analysis of each case, it was surprising to see that the relationship between cultural gap and deal result of two of four cases, are opposite to Rankine´s theory. At this point, we can see that M&As between companies similar in culture is not always successful or that failure between organizations having significantly different cultures is not always true, and then the empirical study on the acculturation dynamics made the further explanation that cultural differences are not the critical factor leading to success or failure, but rather how participants in integration perceive and respond to the cultural differences will impact the deal result.

Wu, Yaoan. "How do institutions matter to cross-border mergers and acquisitions by emerging economy multinationals in developed countries?" Thesis, University of York, 2014. http://etheses.whiterose.ac.uk/7046/.

Zou, Huan. "The determinants of cross-border mergers and acquisitions (M&As) in emerging markets : an insight into China." Thesis, University of Manchester, 2006. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.622087.

Troudart, Jessy. "Analyse et comparaison des stratégies d’internationalisation des banques." Thesis, Bordeaux 4, 2012. http://www.theses.fr/2012BOR40046/document.

Fikru, Mahelet Getachew. "Mergers and Acquisitions with a Flexible Policy Regime: Theoretical and Empirical Analysis." OpenSIUC, 2011. https://opensiuc.lib.siu.edu/dissertations/325.

Wilmink, Wouter. "Toehold acquisitions, bidder’s acquisition performance,and the cross-border effect." Thesis, Uppsala universitet, Företagsekonomiska institutionen, 2017. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-328145.

Hartmann, Ivo. "Politika EU v oblasti fúzí a dominantního postavení." Master's thesis, Vysoká škola ekonomická v Praze, 2008. http://www.nusl.cz/ntk/nusl-18307.

Jung, Sabrina. "A Cross-Cultural Merger as a Competitive Advantage." St. Gallen, 2005. http://www.biblio.unisg.ch/org/biblio/edoc.nsf/wwwDisplayIdentifier/01651413002/$FILE/01651413002.pdf.

Bedier, Mohammad El-Saied. "Cross-border Mergers and Acquisitions: The Case of Merger Control v. Merger Deregulation." Thesis, 2015. http://hdl.handle.net/1805/6276.

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Cross-border acquisitions: exploring the opportunities and challenges.

In today’s globalized business environment, cross-border acquisitions have become increasingly prevalent, presenting unique opportunities for companies aiming to expand beyond their domestic markets. These acquisitions allow firms to enter new territories quickly, accessing fresh customer bases, resources, and capabilities that may not be available in their home countries. However, the process is not without its complexities. From navigating different regulatory landscapes to integrating diverse corporate cultures, cross-border acquisitions pose a series of strategic challenges that can impact the success of such ventures. Gary Pryor , a Sr. Business Consultant with Waters Business Consulting, with his extensive experience in international business, emphasizes that understanding these dynamics is crucial for companies looking to leverage global growth opportunities effectively. This article aims to explore both the strategic benefits and the complex challenges involved in cross-border acquisitions, providing a comprehensive overview for businesses considering such moves.

Understanding the Strategic Drivers

The main motivations behind cross-border acquisitions are as multifaceted as the processes themselves. Companies often pursue these deals to expand their market presence, diversify their holdings, and access new technologies that are pivotal for staying competitive in a fast-paced global market. Such acquisitions serve as strategic tools not only for market expansion but also for leveraging local brands and operations that have established market insights and customer loyalty in their regions.

Gary Pryor points out that cross-border acquisitions are not just about physical expansion but also about acquiring strategic assets that can enhance a company’s competitive edge. For instance, acquiring a company in a region with advanced technological capabilities can provide access to innovations that can be scaled globally, transforming a company’s operations and product offerings. Moreover, diversification through these acquisitions helps companies mitigate risks by spreading their operational bases across various economic environments, which can buffer against market volatility in any one region.

Navigating Legal and Regulatory Frameworks

Cross-border acquisitions necessitate a deep understanding of the diverse legal and regulatory environments across different countries. Each nation has its own set of laws and regulatory requirements, which can vary significantly from one jurisdiction to another. This complexity requires companies to engage in thorough legal due diligence to ensure compliance with all relevant laws, including antitrust regulations, securities laws, and local business practices.

Gary Pryor emphasizes the critical role of international legal experts in this process. These professionals facilitate compliance and smooth transactions by offering their expertise in navigating the legal landscapes of the involved countries. Their knowledge helps mitigate risks associated with regulatory non-compliance, which can lead to penalties, deal delays, or transaction cancellations. Effective legal due diligence involves not only understanding the current regulatory framework but also anticipating potential legal changes that could affect the acquisition.

Cultural and Operational Integration

The integration of companies from different cultural and operational backgrounds presents significant challenges in cross-border acquisitions . Differences in corporate culture, business practices, and employee expectations can lead to misunderstandings and conflicts that undermine the potential synergies of a merger.

To address these challenges, Gary Pryor advises on strategies that emphasize cultural respect and the alignment of business operations. This might involve conducting cultural training sessions for employees, establishing integration teams that include members from both companies, and setting clear communication channels to ensure that all staff are informed and engaged throughout the transition process. Aligning business practices may require modifications to operational procedures to harmonize differing approaches in areas like customer service, human resources, and project management.

Financial Implications and Valuation Challenges

Financial aspects, particularly the valuation of foreign assets, play a crucial role in the success of cross-border acquisitions. Valuing a company in a different economic context involves understanding various financial metrics within the local market environment, such as cash flow patterns, market growth rates, and competitive positioning. Financial structuring must also be carefully considered to optimize tax implications and funding strategies.

Currency fluctuations and economic instability can significantly impact the valuation process. Exchange rate volatility can affect the actual value transferred during the acquisition and influence future earnings from the overseas entity. Gary Pryor highlights the importance of including clauses that protect against currency risks and recommends regular reassessment of the financial performance of acquired assets to ensure they meet strategic expectations post-acquisition.

Dealing with Political Risks and Economic Instability

Political changes and economic conditions in the host country can significantly impact the success of cross-border acquisitions. Factors such as changes in government, shifts in economic policy, and political instability can disrupt operations, affect profitability, and even jeopardize the entire investment. To mitigate these risks, Gary Pryor suggests developing flexible exit strategies that allow for a structured disengagement from the investment if the political landscape becomes too unstable. Additionally, investing in political risk insurance can provide protection against losses due to expropriation, nationalization, or political violence.

Achieving Synergies and Strategic Goals

Realizing synergies and achieving strategic goals post-acquisition are pivotal for the success of cross-border mergers. Planning and executing integration strategies effectively requires a clear understanding of the combined entity’s objectives. Gary Pryor emphasizes the importance of clear communication across all levels of the organization and sustained management efforts to align operations and corporate cultures. This alignment helps to ensure that the merger or acquisition delivers the anticipated benefits and achieves efficiency gains, market expansion, and improved competitive positioning.

In Conclusion

Cross-border acquisitions offer businesses significant opportunities for accelerated growth and an enhanced global presence, yet they come with a myriad of challenges such as navigating legal complexities, bridging cultural differences, and managing financial risks. Future business leaders are encouraged to approach these ventures with a balanced perspective, equipped with thorough preparation and strategic foresight. By understanding both the potential rewards and inherent risks, leaders can more effectively navigate the complexities of international mergers and acquisitions, positioning their enterprises for long-term success in the global market.

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