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Culture clashes in cross-border mergers and acquisitions: A case study of Sweden's Volvo and South Korea's Samsung

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  • Lee, Sung-Jun
  • Kim, Joongwha
  • Park, Byung Il

Abstract

This study investigates the way in which employees from acquiring and acquired firms experience cultural differences during post-acquisition integration. We examined Volvo Construction Equipment's acquisition of Samsung Heavy Industry's division of construction equipment. Two ontologically bipolar conceptualizations of culture – the classic and social constructivist concept of culture – are discussed. Semi-structured interviews were conducted at Volvo Construction Equipment Korea twice over an 11-year interval, in 2001 and 2012, respectively. The results suggest that while the classic concept of culture correctly predicts what kinds of culture-dependent problems may occur during post-acquisition integration, the social constructivist concept of culture can better predict whether or not these problems may occur.

Suggested Citation

  • Lee, Sung-Jun & Kim, Joongwha & Park, Byung Il, 2015. "Culture clashes in cross-border mergers and acquisitions: A case study of Sweden's Volvo and South Korea's Samsung," International Business Review, Elsevier, vol. 24(4), pages 580-593.
    • Handle: RePEc:eee:iburev:v:24:y:2015:i:4:p:580-593
    DOI: 10.1016/j.ibusrev.2014.10.016
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