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Does patenting increase the probability of being acquired? Evidence from cross-border and domestic acquisitions

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Author Info
Jyrki Ali-Yrkkö
Ari Hyytinen
Mika Pajarinen

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Abstract

A firm that owns a patent has a legal right to exclude. Applying for the patent, however, discloses discovery of an invention by the firm. Both the ownership of the right and the disclosure of the discovery expose the firm to an acquisition, because other firms may be interested in buying the right or the invention for a number of reasons. This idea of patent-driven mergers and acquisitions (M&As) is tested using a large sample of Finnish firms that are mostly private and small. It is found that patenting by a Finnish firm is positively correlated with the probability that the firm is acquired by a foreign firm.

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Article provided by Taylor and Francis Journals in its journal Applied Financial Economics.

Volume (Year): 15 (2005)
Issue (Month): 14 (October)
Pages: 1007-1017
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Handle: RePEc:taf:apfiec:v:15:y:2005:i:14:p:1007-1017

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  38. Jyrki Ali-Yrkkö & Ari Hyytinen & Mika Pajarinen, 2005. "Does patenting increase the probability of being acquired? Evidence from cross-border and domestic acquisitions," Applied Financial Economics, Taylor and Francis Journals, vol. 15(14), pages 1007-1017, October. [Downloadable!] (restricted)
    Other versions:
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Petri Rouvinen & Pekka Tsupari, 2004. "Inter-firm Collaboration and Electronic Business: Effects on Profitability in Finalnd," Discussion Papers 895, The Research Institute of the Finnish Economy. [Downloadable!]
  2. Tomi Hussi, 2004. "A Managerial Relevance of Maintenance of Work Abilility. A Finnish Perspective," Discussion Papers 897, The Research Institute of the Finnish Economy. [Downloadable!]
  3. Mika Maliranta & Satu Nurmi, 2004. "Analyzing Entrepreneurship with the Finnish Linked Employer-Employee Data (FLEED).Matching and qualitative properties of the data," Discussion Papers 920, The Research Institute of the Finnish Economy. [Downloadable!]
  4. Frey, Rainer & Hussinger, Katrin, 2006. "The Role of Technology in M&As: A Firm Level Comparison of Cross-Border and Domestic Deals," ZEW Discussion Papers 06-69, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
    Other versions:
  5. Jyrki Ali-Yrkkö, 2006. "Technology Sourcing Through Acquisitions – Do High Quality Patents Attract Acquires?," Discussion Papers 1025, The Research Institute of the Finnish Economy. [Downloadable!]
  6. Petri Rouvinen, 2004. "Diffusion of Digital Mobile Telephony - Are Devoloping Countries Different?," Discussion Papers 901, The Research Institute of the Finnish Economy. [Downloadable!]
    Other versions:
  7. Antti-Jussi Tahvanainen, 2004. "Academic Spin-offs in Finnish Biotechnology," Discussion Papers 900, The Research Institute of the Finnish Economy. [Downloadable!]
  8. Hannu Piekkola, 2004. "Active Ageing Policies in Finland," Discussion Papers 898, The Research Institute of the Finnish Economy. [Downloadable!]
  9. Markku Stenborg, 2004. "Are There Biases in the Market Definition Procedure?," Discussion Papers 903, The Research Institute of the Finnish Economy. [Downloadable!]
  10. Kari Alho, 2004. "The Finnish EMU Buffers and the Labour Market under Asymmetric Shocks," Discussion Papers 914, The Research Institute of the Finnish Economy. [Downloadable!]
  11. Liisa Leijola, 2004. "The Education System in Finland - Development and Equality," Discussion Papers 909, The Research Institute of the Finnish Economy. [Downloadable!]
  12. Pekka Ylä-Anttila & Jyrki Ali-Yrkkö & Martti Nyberg, 2004. "Foreign Ownership in Finland - Boosting Firm Performance and Changing Corporate Governance," Discussion Papers 904, The Research Institute of the Finnish Economy. [Downloadable!]
  13. Jyrki Ali-Yrkkö & Ari Hyytinen & Mika Pajarinen, 2004. "Does Patenting Increase the Probability of Being Acquired? Evidence from Cross-border and Domestic Acquisitions," Discussion Papers 891, The Research Institute of the Finnish Economy. [Downloadable!]
    Other versions:
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