Mitigating post-acquisition risk: the interplay of cross-border uncertainties

Yimai Lewis and Konstantinos Bozos

Journal of World Business, 2019, vol. 54, issue 5, -

Abstract: Do international acquisitions increase acquirers’ risk? If so, can cross-border uncertainties interact and offset such risk? The perspective of integrated risk management suggests international acquirers could mitigate their overall risk through the interplay of various levels of uncertainties. Using asset pricing to measure shifts in risk and a large sample of international acquisitions by US firms during 2000–2014, we find that acquirers can reduce their risk by trading internal and deal-level risk factors (information asymmetry and moral hazard) off against external and country-level risk factors (“liability of foreignness” and “double-layered acculturation”).

Keywords: Risk; Mergers and acquisitions; International; Cultural distance; Institutional distance (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1090951618307065
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:worbus:v:54:y:2019:i:5:4

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/620401/bibliographic
http://www.elsevier. ... 620401/bibliographic

DOI: 10.1016/j.jwb.2019.100996

Access Statistics for this article

Journal of World Business is currently edited by David Collings and Jonathan Doh

More articles in Journal of World Business from Elsevier
Bibliographic data for series maintained by Catherine Liu ().