Resource redeployment following horizontal acquisitions in Europe and North America, 1988–1992
✍ Scribed by Laurence Capron; Pierre Dussauge; Will Mitchell
- Publisher
- John Wiley and Sons
- Year
- 1998
- Tongue
- English
- Weight
- 153 KB
- Volume
- 19
- Category
- Article
- ISSN
- 0143-2095
No coin nor oath required. For personal study only.
✦ Synopsis
This paper studies redeployment of resources between target and acquiring businesses following horizontal acquisitions. The analysis draws from perspectives that emphasize the strategic importance of resources that are subject to market failure. We define a five-part typology of R&D, manufacturing, marketing, managerial, and financial resources. We show that targets and acquirers frequently redeploy resources following horizontal acquisitions, especially resources that frequently face market failure. We then show that the magnitude of redeployment of each type of resource increases with the asymmetry of the merging businesses' relative strength on the resource dimension. The research stresses evolutionary perspectives on business organizations that emphasize the importance of organizational differences in competitive markets.