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Market and Technology Access Through Firm Acquisitions: Beyond One Size Fits All

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  • Hussinger, Katrin
  • Grimpe, Christoph

Abstract

Firm acquisitions have been shown to serve as a way to gain access to international markets, technological assets, products or other valuable resources of the target firm. Given this heterogeneity of takeover motivations and the skewness of the distribution of the deal value we show whether and how the importance of different takeover motivations changes along the deal value distribution. Based on a comprehensive dataset of 652 European mergers and acquisitions in the period from 1997 to 2003, we use quantile regressions to decompose the deal value at different points of its distribution. Our results indicate that the importance of technological assets is indeed higher for smaller target firms. The findings support the view on small acquisition targets to complement the acquirer?s technology portfolio while larger acquisition targets tend to be used to gain access to international markets.

Suggested Citation

  • Hussinger, Katrin & Grimpe, Christoph, 2008. "Market and Technology Access Through Firm Acquisitions: Beyond One Size Fits All," ZEW Discussion Papers 08-037, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  • Handle: RePEc:zbw:zewdip:7309
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    Cited by:

    1. Joel Stiebale & Michaela Trax, 2011. "The effects of cross-border M&As on the acquirers' domestic performance: firm-level evidence," Canadian Journal of Economics, Canadian Economics Association, vol. 44(3), pages 957-990, August.
    2. Henkel, Joachim & Rønde, Thomas & Wagner, Marcus, 2010. "And the Winner Is--Acquired: Entrepreneurship as a Contest with Acquisition as the Prize," CEPR Discussion Papers 8147, C.E.P.R. Discussion Papers.
    3. Richard Fabling & Lynda Sanderson, 2014. "Foreign acquisition and the performance of New Zealand firms," New Zealand Economic Papers, Taylor & Francis Journals, vol. 48(1), pages 1-20, April.
    4. Joel Stiebale & Michaela Trax, 2010. "The Eff ects of Cross-border M&As on the Acquirers’ Domestic Performance – Firm-level Evidence," Ruhr Economic Papers 0159, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    5. repec:zbw:rwirep:0159 is not listed on IDEAS

    More about this item

    Keywords

    Firm acquisitions; technological assets; market access; quantile regression;

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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