Cross-border mergers and acquisitions by emerging market firms: A comparative investigation

Ping Deng and Monica Yang

International Business Review, 2015, vol. 24, issue 1, 157-172

Abstract: This paper applies and extends resource dependence theory (RDT) to comparatively investigate major factors that determine the level of cross-border mergers and acquisitions (M&As) by emerging market firms (EMFs) in developed and developing markets. We argue that the resource dependence logic of M&As (or simply the M&A logic) provides a unique perspective in better understanding the internationalization of EMFs via cross-border M&As, but the explanation is bounded by institutional environment (i.e., government effectiveness) in a host nation. Our empirical results, based on a large panel data analysis of cross-border M&As by EMFs from nine emerging economies from 2000 to 2012, suggest that the intensity of EMFs to acquire vital resources for constraint absorption increases the likelihood of their cross-border M&As and the positive relationship is negatively moderated by host government effectiveness. On top of that, consistent with the predictions of resource dependence arguments, we found differences in the determinants of cross-border M&As by EMFs in developed and developing countries. Finally, host country factors attracting Chinese M&As are different from those attracting other emerging economies. Thus, generalization of Chinese M&A deals to other EMFs need to be cautious.

Keywords: Comparative approach; Cross-border mergers and acquisitions (M&As); Emerging market firms (EMFs); International expansion; M&A logic; Resource dependence theory (RDT) (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (80)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0969593114001103
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:iburev:v:24:y:2015:i:1:p:157-172

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/133/bibliographic
http://www.elsevier. ... me/133/bibliographic

DOI: 10.1016/j.ibusrev.2014.07.005

Access Statistics for this article

International Business Review is currently edited by P. Ghauri

More articles in International Business Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().