Accessibility navigation


The effects of cross-border and cross-industry mergers and acquisitions on home-region and global multinational enterprises

Kling, G., Ghobadian, A., Hitt, M. A., Weitzel, U. and O'Regan, N. (2014) The effects of cross-border and cross-industry mergers and acquisitions on home-region and global multinational enterprises. British Journal of Management, 25 (S1). S116-S132. ISSN 1467-8551

Full text not archived in this repository.

It is advisable to refer to the publisher's version if you intend to cite from this work. See Guidance on citing.

To link to this item DOI: 10.1111/1467-8551.12023

Abstract/Summary

We examine the effects of international and product diversification through mergers and acquisitions (M&As) on the firm's risk–return profile. We identify the rewards from different types of M&As and investigate whether becoming a global firm is a value-enhancing strategy. Drawing on the theoretical work of Vachani (Journal of International Business Studies, 22 (1991), pp. 307−222) and on Rugman and Verbeke's (Journal of International Business Studies, 35 (2004), pp. 3−18) metrics, we classify firms according to their degree of international and product diversification. To account for the endogeneity of M&As, we develop a panel vector autoregression. We find that global and host-region multinational enterprises benefit from cross-border M&As that reinforce their geographical footprint. Cross-industry M&As enhance the risk–return profile of home-region firms. This effect depends on the degree of product diversification. Hence there is no value-enhancing M&A strategy for home-region and bi-regional firms to become ‘truly global’.

Item Type:Article
Refereed:Yes
Divisions:Henley Business School > Leadership, Organisations and Behaviour
ID Code:33420
Publisher:Wiley

University Staff: Request a correction | Centaur Editors: Update this record

Page navigation