Do previous alliance experiences affect the acquisition performance

• Main Authors: Ming-Tse Tsai, 蔡明澤
• Other Authors: Shao-Chi Chang
• Format: Others
• Language: en_US
• Published: 2006
• Online Access: http://ndltd.ncl.edu.tw/handle/98822751020127213630

碩士 === 國立成功大學 === 國際企業研究所碩博士班 === 94 === In the past decades, acquisition is a frequently used strategy. Researchers are interested in the post-acquisition performance. But most of the empirical results are disappointing. We try to propose an approach to bring bidders the better performance. Previous studies indicated that the alliances provide an opportunity for company to learn from partners. Therefore, we propose that the previous bidder and target’s alliances could cut down the information asymmetry and positively influence the acquisition performance. Whether the acquisition is non-horizontal or not is adopted as the moderator in the analysis. Non-horizontal acquisitions usually involve more information asymmetry, thus we expect prior alliances experiences are more influential in non-horizontal acquisition. Since we expect the alliances experiences with target could reduce the risk from information asymmetry, we suggest that the acquirers which face high level of information asymmetry are more likely to make alliances with target before acquisition. In this paper, we collect the US domestic acquisitions events between 1993 and 2000, and alliances events are between 1989 and 2000 from SDC. We use the post-acquisition 3-year buy-and-hold return in stock to measure the bidders’ performance, and to test our arguments. Our results support that the bidder-target alliances experiences let the bidders get better performance. The bidders possibly have prior bidder-target alliance when acquiring a nonpublic target firm. In contrast, we find the different industry background doesn’t have obvious moderating effect, and the bidders don’t tend to make alliances prior acquisitions as acquiring high technology or service target firms.