Title: Serial acquirers' strategy in the telecommunications sector: integration or indigestion?

Authors: Julio Navío-Marco; Marta Solórzano-García; Juan Antonio Vicente-Virseda

Addresses: Facultad de CC Económicas y Empresariales (UNED), Paseo Senda del Rey 11, Madrid 28040, Spain ' Facultad de CC Económicas y Empresariales (UNED), Paseo Senda del Rey 11, Madrid 28040, Spain ' Facultad de CC Económicas y Empresariales (UNED), Paseo Senda del Rey 11, Madrid 28040, Spain

Abstract: This article analyses the performance of the serial operations of mergers and acquisitions (M&As) in the telecommunications sector, seeking to understand if the serial M&A strategy leads to stockholder wealth maximisation, and the role of the acquirer's characteristics and its behaviour as an acquirer. After calculating the abnormal returns of telecommunications M&As from 2000 to 2010 and evaluating the long-term value creation/destruction of these operations, neural network and clustering techniques are used to study the serial acquirer's behaviour versus occasional acquirers, to understand the factors influencing the success of the operations and to classify the acquirers into different types. Among other findings, we identify relevant variables that can make the strategy of the serial acquirer successful, and observe signals of indigestion in a certain type of serial acquirer, showing post-merge value destruction. We reflect that the capacity of an organisation to assimilate its previous acquisitions tends to be limited.

Keywords: mergers and acquisitions; serial acquisitions; strategy; value creation; telecommunications; organisational learning; intangibles; CTAR; internationalisation; operators.

DOI: 10.1504/EJIM.2020.107029

European Journal of International Management, 2020 Vol.14 No.3, pp.421 - 442

Received: 29 Oct 2017
Accepted: 29 Mar 2018

Published online: 02 Mar 2020 *

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