Acquired Ownership,Degree Of Integration And Direction As Determinants Of Post-Acquisition Innovation Performance:Evidence From Cross-Border Technological Acquisitions

To seek new knowledge and technology capabilities along with locational advantages firms are moving ahead of their national boundaries through cross border acquisitions.The technological intensive industries are facing frequent and rapid changes in technology.Therefore,the importance of acquisitions in the technology industry from the perspective of improvement in technology innovation inspired us to unveil the factors and paths which could be likely to successfully increase the post-acquisition innovation performance of the acquirer firm.This dissertation is divided into three empirical chapters.The first empirical study resolves the indistinctness regarding the importance of acquired ownership and degree of integration for the value addition in innovation after the completion of the cross the border acquisition deals of technology firms.Incorporating arguments from the agency theory and RBV this study investigated the mediating role of the degree of integration between the acquired ownership and post-acquisition innovation performance of the acquirer firm through the analyses of 546 firms from Biotechnology,Computer,Communication and Electronics industries.The study found that acquired ownership undertaken by the acquirer firm is positively relating to the degree of integration.We found that the degree of integration of the target firm's activities into those of the acquirer firm increase the post-acquisition innovation performance of the acquirer firm.Further,we found that the degree of integration has a mediation effect between the relationship of acquired ownership and post-acquisition innovation performance of the acquirer firm.The present study explores the relationship of an acquired ownership in the target firm on the post-acquisition innovation performance of the acquirer firm in the cross-border technological acquisitions.Institutional theory conversed that how the distance between the institutions of the countries of the firms involved in an acquisition affect the relationship of acquired ownership on the post-acquisition innovation output of the acquirer firm.Further,the fluctuations of such a relationship have been investigated based on the institutional distance between the countries of the firms involved in an acquisition deal.For this the analysis of 842 technological acquisitions verified that higher acquired ownership undertaken by the acquirer firm increase the postacquisition innovation performance.Whereas the institutional distance between the firm's nation of origin such as normative and cultural-cognitive distance destructs the positive relationship of acquired ownership and post-acquisition innovation output of the acquirer firm.Besides,this study claimed that the acquirer firm's technology capability,technology efficiency and absorptive capacity improve the post-acquisition innovation performance.Acquisition deals completed by the acquirer firm from emerging economies(EE)in various origins of the globe have turned out to be a spotlight for the researchers.This rejuvenating facet of deals completion from EE acquirer firms claim for vigorous research for analyzing the behavior of EE acquirer firms in acquisition strategies.Consequently,the present study put empirical insights on direction when EE acquirer firm undertake an acquisition deal with the DE target firm.The findings contended that the EE acquirer firm undertake higher ownership stance in the DE target firm.Whereas,the EE acquirer firms are less likely to integrate the critical essential resources of the counterpart target firm from the DE.In addition,the direction(EE to DE)negatively influences the post-acquisition innovation performance of the acquirer firm.In recent years acquired ownership earned significant attention as an indicator of acquisition success and improvement in post-acquisition performance in the context of cross-border acquisitions.But mere buying greater ownership to ensure more combinations of resources does not make the flow of technology knowledge and resources automatically.In this study,we argued that ownership acquired in the target firm impacts the post-acquisition innovation performance of the acquirer firm through the mechanism of integration.In past literature the role of national institutional distance between the countries of firms involved in an acquisition has been examined for classifying the choice of acquired ownership by the acquirer firm.However,this study responded to the least research moderating effect of institutional distance on the innovation production of the acquirer firm realized from the acquired ownership.To the best of our knowledge this is one of the studies that empirically examined the effect of direction(when the EE acquirer firm buys technological resources of the target firm from developed economy)on the degree of integration of resources and post-acquisition innovation performance of the acquirer firm.