Mergers & Acquisitions and Innovation Performance in the Telecommunications Equipment Industry

Tseveen Gantumur and Andreas Stephan
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Tseveen Gantumur: DIW Berlin

No 2011-5, JIBS Working Papers from Jönköping International Business School

Abstract: The worldwide telecommunications equipment industry has experienced an enormous number of mergers and acquisitions (M&A). This paper examines the innovation determinants of M&A activity and the consequences of M&A on technological potential and innovation performance. We extend the resource-based theory in elucidating external technology sourcing and provide empirical evidence on the keen reliance of the equipment firms on M&A as a technology sourcing strategy for the period 1988–2004. Employing the matching propensity score approach, this study provides evidence that mergers realize a significant growth in the innovation performance of firms. The post-merger innovation performance, in turn, is driven by both the prior success of inhouse R&D commitment and the deterioration of internal technological capabilities at acquiring firms.

Keywords: Mergers & Acquisitions; Innovation Performance; Telecommunications Equipment Industry (search for similar items in EconPapers)
Pages: 37 pages
Date: 2011-08-24
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Related works:
Journal Article: Mergers & acquisitions and innovation performance in the telecommunications equipment industry (2012)
Working Paper: Mergers & Acquisitions and Innovation Performance in the Telecommunications Equipment Industry (2007)
Working Paper: MERGERS & ACQUISITIONS AND INNOVATION PERFORMANCE IN THE TELECOMMUNICATIONS EQUIPMENT INDUSTRY (2007)
Working Paper: Mergers & acquisitions and innovation performance in the telecommunications equipment industry (2007)
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