The Impact of Culture Dissimilarity on the M & A Performances in China

• Main Authors: Shan-huei Wang, 王珊彗
• Other Authors: Len-Kuo Hu
• Format: Others
• Language: en_US
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/20627922151348821079

碩士 === 國立成功大學 === 企業管理學系碩博士班 === 97 === This study represents a practical examination of the cultural dissimilarities and post-acquisition performance of acquirers involved in cross-national mergers and acquisitions within China. Based on a national culture dissimilarity index (NCDI), an industrial and organizational dissimilarity index (IODI), and a corporate governance dissimilarity index (CGDI), we employ hierarchical regression analysis to examine our models. Data on 92 firms involved in mergers and acquisitions from 1985 to 2005 indicate that the national cultures of acquirers and targets are often significantly different. Moreover, results show that greater dissimilarities are associated with lower growth ratios in terms of acquirers’ ROA and ROE: board structure differences lead to decreased ROA, while organizational atmosphere differences in terms of busy and non-busy outsider boards increase the ROE growth ratio. Further, national culture dissimilarities led to a 150% reduction in terms of ROA, and a 400% reduction in ROE as compared to organizational culture dissimilarities. However, no cultural factors can explain the negative changes related to stock premiums. We also examine the interactive relationships – results show that there are significant interactive relationships between national culture dissimilarities, organizational culture dissimilarities, and post-acquisition performance in China.