Cross-border mergers and acquisitions: Impact on marketing capability and firm performance

Mahabubur Rahman, Mary Lambkin and Sm Riad Shams
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Mahabubur Rahman: ESC [Rennes] - ESC Rennes School of Business
Mary Lambkin: UCD - University College Dublin [Dublin]
Sm Riad Shams: Northumbria University [Newcastle]

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Abstract: Emerging country firms have been increasingly engaging in cross-border mergers and acquisitions, and these acquirers predominantly acquire firms from developed countries. The motivation for such acquisitions is to achieve market access but also to benefit from transfers of cross-border managerial skills and knowledge. The performance of such acquisitions has started to receive some research attention, particularly financial performance, but the transfers to other areas such as marketing have not yet been explored. This article addresses this gap by studying the experience of 34 acquirers from emerging countries which acquired firms in developed countries. This study uses two-stage window data envelopment analysis (DEA) and Tobit regression to investigate the impact of these acquisitions on the marketing capability and overall firm performance of the acquiring firms. The results show that the marketing capability of the acquiring firms did improve in the post-merger years and this improvement can be partly attributed to the acquisition. The findings also show that the overall performance of the acquiring firms improved following acquisition, but this is a continuation of superior performance from the pre-merger years rather than a synergistic gain from the acquisitions.

Keywords: cross-border M&A; data envelopment analysis (DEA); emerging markets; firm performance; marketing capability (search for similar items in EconPapers)
Date: 2021-01
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Published in Journal of general management, 2021, 46 (2), pp.129-143. ⟨10.1177/0306307020934673⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03181277

DOI: 10.1177/0306307020934673

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