Overcoming Buyer-Seller Tensions in the Pre-Acquisition Process

Raj K. Shankar, Einar Rasmussen, Marius T. Mathisen and Øystein Widding

Entrepreneurship Theory and Practice, 2023, vol. 47, issue 5, 1731-1759

Abstract: Larger firms are increasingly acquiring innovative new ventures at an early stage. Despite significant integration challenges with these acquisitions, the elongated pre-acquisition process of aligning buyers’ and sellers’ different objectives is rarely studied. By studying nine academic spin-off acquisitions, we develop a three-phase model outlining the temporal dynamics of the pre-acquisition process. In each phase—namely, strategic fit, synergy confidence, and deal structure—a specific buyer-seller tension emerges. By showing how each of these tensions needs to be overcome prior to an acquisition event, our dialectical model complements the dominant focus on post-integration activities in the acquisition literature.

Keywords: academic spin-offs; dialectical process; new technology-based firms; pre-acquisition process; technology acquisition (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:sae:entthe:v:47:y:2023:i:5:p:1731-1759

DOI: 10.1177/10422587221102110

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