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Similarity in Cross-border Mergers and Acquisitions: Imitation, Uncertainty and Experience among Chinese Firms, 1985–2006

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  • Yang, Monica
  • Hyland, MaryAnne

Abstract

In the search for determinants affecting the decision making process of cross-border mergers and acquisitions (CBMAs), we draw on the mimetic isomorphism argument to examine (1) whether firms from emerging markets imitate each other and become similar on multiple decisions of CBMA; and (2) what factors affect the strength of mimetic isomorphism. With 1580 CBMAs initiated by 937 Chinese firms from 1985 to 2006, we found that mimetic isomorphism in CBMAs is partially supported by Chinese firms. Specifically, the degree of similarity in two CBMA decisions (the product relatedness and the location of target firms) increases when the number of completed deals initiated by others at a prior time increases and when firms can tell what the most popular decision choice is. We found that not all CBMA decisions react to the force of imitation in the same way. Finally, the force of mimetic isomorphism is strengthened by environmental instability but weakened by firms' own experience. This study provides implications for theory and research on CBMA and imitation as well as multinational firms from emerging economies.

Suggested Citation

  • Yang, Monica & Hyland, MaryAnne, 2012. "Similarity in Cross-border Mergers and Acquisitions: Imitation, Uncertainty and Experience among Chinese Firms, 1985–2006," Journal of International Management, Elsevier, vol. 18(4), pages 352-365.
    • Handle: RePEc:eee:intman:v:18:y:2012:i:4:p:352-365
    DOI: 10.1016/j.intman.2012.09.001
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    6. Reddy, Kotapati Srinivasa, 2016. "Institutional Voids and Tax litigation in Emerging Economies: The verdict of Vodafone cross-border acquisition of Hutchison," MPRA Paper 74264, University Library of Munich, Germany, revised 2016.
    7. Yameng Li & Ruosu Gao & Jingyi Wang, 2021. "Determinants of EMNEs’ Entry Mode Decision with Environmental Volatility Issues: A Review and Research Agenda," JRFM, MDPI, vol. 14(10), pages 1-22, October.
    8. Filatotchev, Igor & Bell, R. Greg & Rasheed, Abdul A., 2016. "Globalization of Capital Markets: Implications for Firm Strategies," Journal of International Management, Elsevier, vol. 22(3), pages 211-221.
    9. Schriber, Svante & Degischer, Daniel, 2020. "Disentangling acquisition experience: A multilevel analysis and future research agenda," Scandinavian Journal of Management, Elsevier, vol. 36(2).
    10. Jiang, Guoliang F. & Holburn, Guy L.F. & Beamish, Paul W., 2014. "The Impact of Vicarious Experience on Foreign Location Strategy," Journal of International Management, Elsevier, vol. 20(3), pages 345-358.
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    12. Hong Zhu & Qi Zhu, 2016. "Mergers and acquisitions by Chinese firms: A review and comparison with other mergers and acquisitions research in the leading journals," Asia Pacific Journal of Management, Springer, vol. 33(4), pages 1107-1149, December.
    13. Arup Barua & Alexandra Ioanid, 2020. "Country Brand Equity: The Decision Making of Corporate Brand Architecture in Cross-Border Mergers and Acquisitions," Sustainability, MDPI, vol. 12(18), pages 1-24, September.
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