Authors: Daniel Rottig
Addresses: Lutgert College of Business, Florida Gulf Coast University, Fort Myers, Florida, USA
Abstract: This paper advances a social capital perspective to the literature on Mergers and Acquisitions (M&As). A conceptualisation of social capital is used that encompasses internal and external social capital as the two sources of social capital available to Multinational Corporations (MNCs) that undertake M&As across cultures. A theoretical model is developed which suggests that internal and external social capital mitigate the negative effects of organisational and national cultural differences on sociocultural integration and so enable MNCs to exploit opportunities for cultural arbitrage which, in turn, contributes to the performance of M&As. This paper further forwards a dynamic perspective of M&As by considering these transactions as vehicles to both exploit existing and explore new social capital. This paper, therefore, sets out to contribute to a better understanding about M&A performance determinants over time. The implications for research and business practice are discussed.
Keywords: mergers and acquisitions; social capital; sociocultural integration; M&A performance; MNCs; multinational corporations; cross-cultural M&A; organisational culture; national culture; cultural differences.
European Journal of International Management, 2011 Vol.5 No.4, pp.413 - 431
Published online: 26 Jun 2011 *Full-text access for editors Access for subscribers Purchase this article Comment on this article