Service interruption on Monday 11 July from 12:30 to 13:00: all the sites of the CCSD (HAL, EpiSciences, SciencesConf, AureHAL) will be inaccessible (network hardware connection).
Skip to Main content Skip to Navigation
Journal articles

Does Target Country Cultural Orientation Influence M&A?

Abstract : We examine whether the cultural orientation of target firms influences the outcomes of international mergers and acquisitions (M&As). Prior research shows that the national culture of the acquiring firm country influences M&As, as well as the distance between the acquiring and target country cultures. Not previously studied from a cultural perspective of M&As has been the target country culture, despite estimates that about 40% of M&As are target-initiated. Our focus is on target firm cultural orientation, including how cultural orientation affects the likelihood of, and returns from, M&As. Our testing applies three cultural orientation factors (results, tradition and people orientation) extracted from a GLOBE cultural framework to a dataset of firm-level M&A data across 39 countries, in 1990–2016. We find that firms from cultures with a results orientation are less likely to become M&A targets and also experience higher cumulative abnormal returns if acquired, while firms from countries with cultures with a tradition orientation or a people orientation are more likely to become targets but experience lower cumulative abnormal returns if acquired. These results are robust to a comprehensive range of robustness tests. Our findings suggest that understanding the cultural orientation of target firms is important to understanding M&A outcomes.
Document type :
Journal articles
Complete list of metadata

https://hal-rennes-sb.archives-ouvertes.fr/hal-03696970
Contributor : Steven Gouin Connect in order to contact the contributor
Submitted on : Thursday, June 16, 2022 - 1:12:05 PM
Last modification on : Friday, June 17, 2022 - 3:04:04 AM

Identifiers

Collections

Citation

Muhammad Farooq Ahmad, Saqib Aziz, Michael Dowling. Does Target Country Cultural Orientation Influence M&A?. British Journal of Management, Wiley, 2022, 33 (2), pp.906-938. ⟨10.1111/1467-8551.12462⟩. ⟨hal-03696970⟩

Share

Metrics

Record views

0