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Foreign acquisitions and firm performance: the moderating role of prior foreign experience

Foreign acquisitions and firm performance: the moderating role of prior foreign experience
Foreign acquisitions and firm performance: the moderating role of prior foreign experience
This paper relies on a sample of 9419 acquisitions by 1443 UK firms during 1988 to 2014 to investigate the impact of foreign acquisitions on corporate performance. Moreover, the moderating role of firms' prior exposure to foreign markets on the foreign acquisition-performance link is explored. The paper finds that, on average, foreign acquisitions have a negative impact on corporate performance. However, the negative impact of foreign acquisitions disappears under two circumstances: (1) when domestic firms undertake foreign acquisitions; and (2) when highly experienced multinationals undertake foreign acquisitions. Collectively, the findings imply that the benefits (costs) associated with foreign acquisitions are greater (lower) for new entrants into foreign markets and for highly experienced multinationals.
1044-0283
Agyei-Boapeah, Henry
37005f29-d453-458e-b6b5-cd92e55587a4
Agyei-Boapeah, Henry
37005f29-d453-458e-b6b5-cd92e55587a4

Agyei-Boapeah, Henry (2018) Foreign acquisitions and firm performance: the moderating role of prior foreign experience. Global Finance Journal. (doi:10.1016/j.gfj.2018.02.001).

Record type: Article

Abstract

This paper relies on a sample of 9419 acquisitions by 1443 UK firms during 1988 to 2014 to investigate the impact of foreign acquisitions on corporate performance. Moreover, the moderating role of firms' prior exposure to foreign markets on the foreign acquisition-performance link is explored. The paper finds that, on average, foreign acquisitions have a negative impact on corporate performance. However, the negative impact of foreign acquisitions disappears under two circumstances: (1) when domestic firms undertake foreign acquisitions; and (2) when highly experienced multinationals undertake foreign acquisitions. Collectively, the findings imply that the benefits (costs) associated with foreign acquisitions are greater (lower) for new entrants into foreign markets and for highly experienced multinationals.

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Foreign acquisitions and firm performance - Accepted Manuscript
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Accepted/In Press date: 7 February 2018
e-pub ahead of print date: 9 February 2018
Published date: 9 February 2018

Identifiers

Local EPrints ID: 434318
URI: https://eprints.soton.ac.uk/id/eprint/434318
ISSN: 1044-0283
PURE UUID: 02f65b69-2f6b-4665-b7c3-a5a4a23f1dc9
ORCID for Henry Agyei-Boapeah: ORCID iD orcid.org/0000-0003-4798-6324

Catalogue record

Date deposited: 19 Sep 2019 16:30
Last modified: 17 Oct 2019 00:20

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