To acquire, or not to acquire? The debate rages on. Companies have been acquiring other companies for centuries, and still, both scholars and practitioners cannot agree on whether acquisitions create and destroy shareholder value. The contradictory results of research into the value creation or value destruction nature of acquisitions has not dampened the will of those corporate executives with a penchant for buying other firms. Globally, and albeit affected by the general well being of the economy, the value and quantities of acquisitions continues to show strong growth. It is largely accepted that large acquisitions are executed as strategic initiatives which should yield benefits in the medium to long‐term. Using event study methodology with a control portfolio model, this study aimed to evaluate the validity of this claim and ascertain if, at the 5% confidence interval, 14 large acquisitions by companies listed on the JSE achieved significant share price gains in the 378 trading days (18 months at an average of 21 trading days per month) after the acquisition. This study concluded that large acquisitions had statistically; no impact on the long term share price returns of JSE listed acquiring companies. Copyright / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

This study explores the extent to which brand features in the due diligence process preceding mergers and acquisitions. Current literature suggests that when brand elements are integrated efficiently, success levels of the merge improve. Brand is considered broadly with the focus on corporate branding and therefore incorporates elements of imagery, reputation, culture, employees and external stakeholders. Brand equity, which comprises the assets and liabilities of the brand is seen as a source of competitive advantage. As such brand is a critical element which could certainly be incorporated formally into the pre-deal due diligence process. The research questions are to: Investigate and explore to what extent the concept of brand is considered in M&A due diligence in the South African context. Evaluate and explain the differing roles that the selected corporate advisors put forward in the M&A market regarding brand in South Africa. Investigate how M&A practitioners are operating in terms of IFRS 3 legislation which requires transparency in disclosure of intangible assets following a merge. The findings reveal that corporate advisors generally do not incorporate brand elements in the due diligence process. Their focus remains predominantly financial in assessing the cash-flows implicit of the brand in their analysis.A typology of the services and roles of corporate advisors is developed in terms of their approach to M&A consulting. Reporting in terms of intangible assets required by IFRS 3 convention is investigated and the findings confirm that transparency of valuation is not adequately revealed. Recommendations to the stakeholders involved in M&A include the incorporation of a formal marketing due diligence process to improve disclosure levels, to gain a deeper insight into marketing drivers of cash-flow, to gain a better understanding of inherent marketing risks and to improve valuation practice. / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

Mergers and acquisitions (M&A) can be either “hostile” or “friendly” in nature. This study looks at the corresponding long-term investment performance of “hostile” and “friendly” takeovers within the mining sector, pre and post the takeover of targets, with the aim to investigate whether there are statistically significant differences about which the investor community should be aware.36 months of monthly share price performance, pre and post first formal merger/takeover announcement date, are studied, for each acquirer is compared with the bourse mining index to calculate the percentage time the acquirer outperforms the market (mining index). Research of the major mining stock exchanges of the world – New York, Toronto, Australia, London and Johannesburg – reveals that the investment performances of “hostile” acquiring mining companies, pre first formal announcement date, are statistically significantly greater than post first formal announcement date. No statistically significant difference was found pre and post first announcement date for “friendly” acquiring mining companies. Although clear differences in post first formal announcement date investment performance are noted between “hostile” acquirers and “friendly” acquirers, there is no statistically significant difference between the investment performances of “friendly” versus “hostile” acquirers. / Dissertation (MBA)--University of Pretoria, 2006. / Gordon Institute of Business Science (GIBS) / unrestricted

In an ever increasing competitive environment, pharmaceutical companies keep on expanding. Mergers&Acquisitions (M&A’s) seems to be one of the preferred means of acquiring critical mass and economies of scale. Research has suggested that human resource capability in the post-acquisition implementation is critical. This study intended to explore whether the role of culture in M&A’s are acknowledged at subsidiary level and if so, to establish an applicable framework for managing it. Twelve semi-structured interviews were conducted in order to gain a deeper understanding of the effect of cultural integration on the M&A process. The data was coded, analysed and collapsed into themes in order to establish the applicability of the framework proposed by Lodorfos&Boateng (2006) and possible amendments to it. Rank order tables were used to measure the relative importance of constructs. Only two thirds of senior management at subsidiary level acknowledged the importance of culture at the time of the M&A, management strategies or plans for dealing with it was found to be inadequate with only fifty percent of interviewees being aware of it. The Lodorfos&Boateng (2006) framework is supported by the data generated in this study, but needs to be amended in terms of leadership role, people orientation and communication. Copyright / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

The internationalization process of firms has essentially been in two contexts, one focusing on those from the developed, and the other on those from the developing economies (Buckley et al.2008). According to (Panond, 2007), internationalization of Emerging Market Multinational Corporations (EMMNCs) has appeared in two waves, the first wave, which emerged in the late 1970s and early 1980s viewed the competitive advantages of EMMNCs as being derived from their ability in reducing costs through scale economies, often substituting machinery with human labour and replacing imported inputs with cheaper local ones, or improving performance through knowledge of operating in less developed markets.The objective of this research has been to understand the variables that drive the success of Mergers and Acquisitions as a mode of entry in Emerging Markets. The research looks at the application of these variables my multinational corporations from both emerging markets and those from developed markets; the aim is to ascertain if these variables are applied differently depending on the type of economy a multinational originates from.Given the saturation of developed markets multinationals have embarked on growth strategies into emerging markets where these markets are perceived as untapped, however most have failed to realise shareholder value as a result of the dynamics and challenges that these economies bring.Fukao et al. 2005 suggests that market share is one of the most useful means used in assessing the structure of the market and a particularly desirable characteristic of a target firm. This is usually couched in terms of having a ―good market position‖ in the relevant market. The specific target criterion is of special consideration in sectors which may show a high degree of stability of market structure (as compared to those which are characterized by technology intensity, low entry barriers and powerful competition, showing high volatility of market shares). As a result, it is expected that the market share variable will bear a positive coefficient in explaining the likelihood of foreign acquisition.The research proved successful that the application of the variables that determine success of an acquisition and merger between multinationals was similar and what drove this success was mainly based on experience in doing mergers and acquisitions. These led to further insights for current and future work on the topic. / Dissertation (MBA)--University of Pretoria, 2012. / Gordon Institute of Business Science (GIBS) / unrestricted

This study investigates the effect of the value of financial flexibility on bidder’s merger and acquisition (M&A) performance, including the differences between domestic and cross-border M&As and the effect of the financial crisis. Using data gathered between 2005-2012 of 3,882 M&As with the bidder from developed Europe or the U.S., OLS regressions are used to predict the effect of value of financial flexibility on the bidder’s cumulative abnormal returns (CARs). Findings reveal partial evidence to support a positive effect of the value of financial flexibility and the cross-border effect on bidder’s M&A performance. Collectively, these findings increase understanding of the interdependence of financial flexibility and investments.

According to World Bank statistics, internet user occupied a quarter of the world population in 2008. In 2010, the number of internet users will be over two billion people. This group will become potential online shopping customers. Online shopping in global market keeps growing. Online shopping has become a trend. The business model of E-continues is facing highly challenge in this market. Enterprises need to look for sustainable way to keep their business continuously growth. This research is based on the external analysis of online retail industry in the U.S.A and the internal analysis of the core resources of the Amazon.com to evaluate the key factors of online M&A targets, to adjust the strategy in highly competitive industry, to utilize the resources acquired by Amazon.com to build up competitive advantage and to implement the effectiveness of strategy. The study mainly research 13 companies acquired by Amazon.com from 2008 to April 2011 on the relationship between core resources and competitive advantage. The study concludes that M&A motivation of Amazon.com is to extend product line, to enter new markets, to obtain the necessary resources and capabilities, to expand the operation scale of the industry. According to the findings and conclusions, the suggestions of the study as followed. 1. In Chinese digital content industry: firms should be focus on content development to build up the competitive advantage of digital content platform. Meanwhile the digital content can be used in each e-reader. In addition, the firms can cooperate with telecommunications firms to provide added-value service. 2. The study found that many internet companies differentiate customer service and build trust from customer by online services to create competitive advantage like creating user community to share knowledge and resources; using word of mouth marketing to attract new customers. Executives should focus on their customer-orientated service to meet market demand.

Whether it is Forbes, The Globe & Mail, The Wall Street Journal or Harvard Business Review, one can¡¦t help but notice that most accounts of business mergers are about what went wrong! In fact, over 70% of all mergers and acquisitions fail to achieve original financial expectations. That is a traumatic statistic. Additionally, although the merging entities give a great deal of importance to financial matters and the outcomes, HR issues are the most ignored ones. To be ironical, many studies have shown that most of the mergers fail to bring out the desired outcomes due to ¡§people-related¡¨ issue. The uncertainty brought out by poorly managed HR issues in mergers and acquisitions have been the major reason for these failures. The human resource issues in the mergers and acquisitions (M&A) can be classified in two phases the pre-merger phase and the post merger phase. Some literature provides ample evidence of difference in between the human resource activities in the two stages: the pre-acquisition and post acquisition period. However, we will focus on post acquisition period. The post acquisition period involves an assessment of the cultural and organizational differences, which will include the organizational cultures, role of leaders in the organization, and the management styles. The usual impacts, such as high turnover rate, decrease in the morale, motivation, and even lead to M&A failures. The other issues in the M&A activity are the changes in the HR policies, downsizing, layoffs, stress on the workers, and information system issues. As a result, human resource system issues in M&A activity are occupying a crucial position, indeed, human resource planning, compensation designs, performance appraisal system, employee development and employee relations should be given in the priority. Beside, the M&A activity also causes changes in their well defined career paths and future opportunities in the organization. Some employees also have to be relocated or assigned new jobs. Accordingly, HR will place employees in a completely different situation with new job profiles and work teams or design the job rotation programs. This may pose a tremendous impact on the performance of the employees. Therefore, HR may also need to develop a variety of training system and communication system to rebuild self-esteem of each employee. Those programs will enhance employees to obtain ability and create their potentials. Finally, the compensation structure among the organizations may also have a unavoidable difference, for example, one of firms may have performance based pay while other may have higher component of fixed pay; Hence the differences in compensation structure and performance appraisal systems also need to be re-evaluated so as to bring equity in the human resource systems and to treat employees at the equal level. Simultaneously, the employee relations issues will gain more importance in the acquisitions of Taiwan¡¦s industries. The power equation between management and unions is bound to change with the acquisition. The acquiring management also needs to keep track of number of unions in the workplace and equations between HR department and unions. Hence, developing a harmony relationship should be put in the first place. To sum up, this will require study of management-union equation, employee contracts, political linkages of the unions, compensation related clauses, number of union and dynamics between the unions. To sun up, once company accomplish those conditions, it will elevate the successful rate of M&A.

Cross-border Merger and Acquisitions (M&As) are an increasingly important strategy adopted by firms in order to create value in fiercely competitive global markets. Cross-border M&A value creation, that is, wealth creation for shareholders from cross-border M&As, is therefore of considerable theoretical and practical importance. However, our understanding of the sources of cross-border M&A value creation remains limited. Researchers have found that the most commonly researched variables have little effect on cross-border M&A value creation. We therefore still do not understand the processes behind cross-border M&As. In this is dissertation I examine the main effects of host country regulatory, economic and physical infrastructure institutions on cross-border M&A value creation. I further examine the moderating effects of host country political institutions on the relationship between host country regulatory institutions and cross-border M&A value creation. Moreover, I investigate the effects of institutional distance between host and home country on cross-border M&A value creation. I argue that the effects of institutional distance (regulatory and economic distance) on cross-border M&A value creation are not symmetric, but rather the effects are contingent upon the direction of the distance. My hypotheses are tested on a sample of 6141 cross-border M&As between 1995 and 2003. Results of this analysis show that acquirers are more likely to create value by acquiring targets in countries with less advanced regulatory institutions. Further, my results indicate that host country political institutions positively moderate the relationship between host country regulatory institutions and cross-border M&A value creation. Host country economic institutions have an inverted U-shaped relationship with cross-border M&A value creation, and host country physical infrastructure institutions have a positive relationship with cross-border M&A value creation. Additionally, results show that there is an inverted U-shaped relationship between institutional distance and cross-border M&A value creation. The findings suggest that the effects of regulatory and economic institutional distance on cross-border M&A value creation are not symmetric. The effects are contingent upon the direction of the distance. That is whether the level of host country institutions is higher or lower than that of home country institutions. Implications for management and public policy are discussed.

Nowadays, empirical researches on corporate post-performance of mergers and acquisitions (M&A) focusing on cost-down synergy and financial accounting phase have not been consistently identified. The lack knowledge of revenue-based marketing value and consumer insights of M&A indicates that other impacts may exist to influence corporate post-acquisition performance. Recent studies have pointed that acquiring company fails to take over all the customers of acquired company after the merge. The results probably provide an important issue about why most M&A activities failed. The study assesses that consumer perceptions of corporate association of acquiring/acquired company have diverse impacts on consumer attitudes and purchase intentions based on consumer-goods classification. Therefore, a 2x2 experimental design manipulated corporation associations and congruity was used for three types of products (i.e. laptops, casual shoes, and raw milk). In the study, one important finding is that diverse intensity of effects, in the relationship of consumer¡¦s attitude and consumer¡¦s repurchase intention after the merge, has showed up with empirical validation among three products. Based on the consumer-goods classification (i.e. specialty goods, shopping goods, and convenient goods), the results indicate that acquiring company fails to take over all the customers of acquired company after the merge, especially in convenient goods. In short, corporate selling different products in different industries should seriously consider about their objectives and focus, during and after the merge.