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To integrate or not to integrate ? complementarity, similarity, and acquisition value creation

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  • Zaheer, Akbar
  • Castaner, Xavier
  • Souder, David

Abstract

In this paper, the authors explain that relatedness is often associated with acquisition value creation without distinguishing between three underlying sources of synergy: business similarity, product complementarity and geographic complementarity. The authors argue that realizing value in acquisitions requires maching the type of relatedness with the appropriate degree of integration; specifically high integration for business similarity, medium integration for product complementarity and low integration for geographic complementarity. Empirical validation, broadly supporting their hypotheses comes from 88 M&As

Suggested Citation

  • Zaheer, Akbar & Castaner, Xavier & Souder, David, 2006. "To integrate or not to integrate ? complementarity, similarity, and acquisition value creation," HEC Research Papers Series 814, HEC Paris.
    • Handle: RePEc:ebg:heccah:0814
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    References listed on IDEAS

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    More about this item

    Keywords

    mergers and acquisitions; value creation; integration;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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