Do Emerging Market Firms Benefit From Acquisitions? A Marketing Perspective

Emerging country firms have been increasingly engaging in cross-border mergers and acquisitions, and these acquirers predominantly acquire firms from developed countries. The motivation for such acquisitions is to achieve market access but also to benefit from transfers of skills and knowledge. The performance of such acquisitions has started to receive some research attention, particularly financial performance, but the transfers to other areas such as marketing capability have not yet been explored. This study addresses this gap by studying the experience of acquirers from emerging countries which acquired firms from developed countries. This study uses two-stage data envelopment analysis (DEA) and Tobit regression to investigate the impact of these acquisitions on the marketing capability and overall firm performance of the acquiring firms. The results show that marketing capability of the sample firms improved in the post-merger years and this improvement can be partly attributed to the acquisition itself. Furthermore, the findings show that overall firm performance of the sample firms also improved following acquisitions. However, the improved firm performance is not because of the acquisitions, but a continuation of better performance from the pre-merger years