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Chinese and Indian M&As in Europe: The relationship between motive and ownership choice

Author

Listed:
  • Piscitello , Lucia

    () (School of Management - Politecnico di Milano)

  • Rabellotti , Roberta

    () (Università di Pavia)

  • Scalera , Vittoria Giada

    () (School of Management - Politecnico di Milano)

Abstract

The present paper is about the ownership choices by Emerging Market Multinational Enterprises (EMNEs) when they invest in Europe through M&As, and the relationship with the main motivations underlying their international expansion. Namely, we claim that EMNEs prefer to acquire less control and keep the local partner when they invest for seeking knowledge. Additionally, EMNEs choose partial acquisitions in case of high dissimilarity in terms of culture, industry and knowledge base. Our empirical analysis relies on a dataset of M&As undertaken by Chinese and Indian MNEs in high and medium-high tech sectors, in the period 2003-2011. We use content analysis of public announcements and company reports for classifying the main motivation of the acquisitions, and econometric analysis for testing our hypotheses. Our results confirm the expectations.

Suggested Citation

  • Piscitello , Lucia & Rabellotti , Roberta & Scalera , Vittoria Giada, 2014. "Chinese and Indian M&As in Europe: The relationship between motive and ownership choice," Papers in Innovation Studies 2014/3, Lund University, CIRCLE - Center for Innovation, Research and Competences in the Learning Economy.
  • Handle: RePEc:hhs:lucirc:2014_003
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    File URL: http://wp.circle.lu.se/upload/CIRCLE/workingpapers/201403_Picitello_et_al.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Cross-border acquisitions; Ownership choice; Foreign direct investment motives; Emerging market firms;

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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