scholarly journals The Impact of Protectionism on the Completion and Duration of Cross-Border Acquisitions

2021 ◽  
Author(s):  
◽  
Rehanna Callaghan
Keyword(s):  
National Security ◽  
Host Country ◽  
Firm Size ◽  
Financial Services ◽  
Foreign Firms ◽  
Gdp Growth ◽  
Target Firm ◽  
Cross Border ◽  
Time Required ◽  
The Impact

<p>This study investigates the impact of protectionism in a host country on the completion likelihood of an announced cross-border acquisition and the time required to complete the acquisition. Adopting a legitimacy perspective, I identify and test boundary conditions at the firm and national levels to study the relationship between protectionism and cross-border acquisition completion and duration. I hypothesise that in host countries with a high level of protectionism, as reflected by the level of non-tariff barriers, cross-border acquisitions are less likely to be completed and the time taken to close the acquisition deal increases. I also propose that the relationships between protectionism and acquisition outcomes are moderated by critical target firm characteristics and the host country's economic condition. Specifically, these moderators include target firm size, target firm performance, the degree to which the target industry is sensitive to national security concerns, and the host country's GDP growth. I test these hypotheses using a sample of 675 cross-border acquisition attempts by firms in the manufacturing and services industries (excluding financial services) into the U.S. and Canada between 1995 and 2015. The results of the statistical analysis support the prediction that the higher the degree of protectionism, the lower likelihood of acquisition completion and the longer the duration is between acquisition announcement and completion. Findings also support the predicted moderating effects of the target firm size, performance and national security concern. However, the hypothesised moderating effect of the host country's GDP growth was not supported by the results. This finding suggests that host country protectionism impacts cross-border acquisition attempts, irrespective of the host country's economic development. These findings have significant implications for legitimacy-based explanations of cross-border acquisitions. In particular, the results of this study indicate that when protectionism is high, the host country is more likely to raise concerns around the legitimacy of foreign firms. In turn, these firms face adverse host country scrutiny which can result in a failed acquisition attempt, or an extended and therefore, costlier acquisition deal. The framework and findings of this study contribute to an institution-based view and, in particular, to a legitimacy-based perspective in the research on the internationalisation of firms.</p>

scholarly journals The Impact of Protectionism on the Completion and Duration of Cross-Border Acquisitions

2021 ◽  
Author(s):  
◽  
Rehanna Callaghan
Keyword(s):  
National Security ◽  
Host Country ◽  
Firm Size ◽  
Financial Services ◽  
Foreign Firms ◽  
Gdp Growth ◽  
Target Firm ◽  
Cross Border ◽  
Time Required ◽  
The Impact

<p>This study investigates the impact of protectionism in a host country on the completion likelihood of an announced cross-border acquisition and the time required to complete the acquisition. Adopting a legitimacy perspective, I identify and test boundary conditions at the firm and national levels to study the relationship between protectionism and cross-border acquisition completion and duration. I hypothesise that in host countries with a high level of protectionism, as reflected by the level of non-tariff barriers, cross-border acquisitions are less likely to be completed and the time taken to close the acquisition deal increases. I also propose that the relationships between protectionism and acquisition outcomes are moderated by critical target firm characteristics and the host country's economic condition. Specifically, these moderators include target firm size, target firm performance, the degree to which the target industry is sensitive to national security concerns, and the host country's GDP growth. I test these hypotheses using a sample of 675 cross-border acquisition attempts by firms in the manufacturing and services industries (excluding financial services) into the U.S. and Canada between 1995 and 2015. The results of the statistical analysis support the prediction that the higher the degree of protectionism, the lower likelihood of acquisition completion and the longer the duration is between acquisition announcement and completion. Findings also support the predicted moderating effects of the target firm size, performance and national security concern. However, the hypothesised moderating effect of the host country's GDP growth was not supported by the results. This finding suggests that host country protectionism impacts cross-border acquisition attempts, irrespective of the host country's economic development. These findings have significant implications for legitimacy-based explanations of cross-border acquisitions. In particular, the results of this study indicate that when protectionism is high, the host country is more likely to raise concerns around the legitimacy of foreign firms. In turn, these firms face adverse host country scrutiny which can result in a failed acquisition attempt, or an extended and therefore, costlier acquisition deal. The framework and findings of this study contribute to an institution-based view and, in particular, to a legitimacy-based perspective in the research on the internationalisation of firms.</p>

Do consumers support the cross-border charitable activities as the same?

2020 ◽  
Vol 11 (3) ◽  
pp. 441-458
Author(s):  
Zelin Tong ◽  
Tingting Li ◽  
Wenting Feng ◽  
Yuanyuan Zhou ◽  
Ling Zhou
Keyword(s):  
Social Identity ◽  
Host Country ◽  
Home Country ◽  
Identity Transformation ◽  
Extensive Literature ◽  
Content Type ◽  
Cross Border ◽  
National Power ◽  
Charitable Activities ◽  
The Impact

Purpose This study aims to investigate the impact of cross-border charitable activities on host- and home-country consumers based on the social identity theory. Design/methodology/approach Through an extensive literature review and two experimental designs, this study establishes the research framework and hypothesises the relationships between the constructs. Findings National power moderates the impact of cross-border charitable activities on host- and home-country consumers. In particular, compared to countries with high national power, countries with low national power undertaking cross-border charitable activities will receive more positive reactions from the host-country consumers, and, conversely, more negative reactions from the home-country consumers. Research limitations/implications From the consumer perspective, this study finds that brand cross-border charitable activities have different influences on consumers in different countries because of an identity transformation mechanism that exists between the “insiders” and the “outsiders”, which is different from the assumptions of western theories. Practical implications The findings provide insights for undertaking brand cross-border charitable activities. Originality/value Previous studies, which are based on social identity categorisation, assume that cross-border charitable activities have a more positive impact on home-country consumers than host-country consumers. However, this study adopts the research paradigm of social identity relationisation and draws an opposite conclusion, which not only expands the theory of local intergroup interaction, but also clarifies how brand cross-border charitable activities influence Chinese consumers.

scholarly journals ČEZMEJNO IZOBRAŽEVANJE IN TVEGANJA ZA NACIONALNO VARNOST

2012 ◽  
pp. 87-100
Author(s):  
VALENTINA JOŠT LEŠER
Keyword(s):  
National Security ◽  
Strategic Performance ◽  
Secondary Sources ◽  
Legal Documents ◽  
Cross Border ◽  
Internet Resources ◽  
Current State ◽  
Key Points ◽  
Potential Risks ◽  
The Impact

Prispevek predstavlja kritično razmišljanje o internacionalizaciji visokega šolstva oziroma o njenem najbolj hitro naraščajočem in razvijajočem delu – čezmejnem izobraževanju in pregledu nad tveganji, ki so povezana z omenjenim pojavom v kontekstu vpliva na nacionalno varnost. Uporabili smo deskriptivno metodo, zlasti pri konceptualizaciji ključnih pojmov, in analizo vsebine primarnih in sekundar- nih virov, pri čemer smo podatke dobili iz domače in tuje strokovne literature, in- ternetnih virov in pravnih dokumentov. Nacionalne vladne politike pomembno vplivajo na proces in izide čezmejnega izobraževanja, zato je za strateško delovanje in napoved trendov bistven pregled nad trenutnim stanjem in morebitnimi tveganji (neokolonializem, beg možganov in korupcija). Ugotavljamo, da je z vidika zagota- vljanja gospodarske konkurenčnosti in posledično nacionalne varnosti posameznih držav nujno potrebna identifikacija trenutnega stanja in analiza pomena trendov na področju čezmejnega izobraževanja. The paper provides a critical reflection on the internationalization of higher education, more specifically of its most rapidly growing and evolving part – cross border education, as well as presents an overview of the risks associated with the above phenomenon in the context of the impact on national security. For the purposes of the paper we have used the descriptive method, especially in conceptualizing key points, and analysis of the primary and secondary sources content was done, where the data was drawn from the domestic and foreign literature, internet resources, and legal documents. National government policies have a significant impact on the process and outcomes of the cross-border education. Strategic performance and trend forecast are thus essential for an overview of the current situation and potential risks (neo-colonialism, brain drain and corruption). We have found that in terms of ensuring the economic competitiveness and, consequently, the national security of individual countries an identification of the current state and the analysis of trend importance in cross border education is needed.

The Impact of the Foreign Corrupt Practices Act on Competitiveness, Bribery, and Investment

2020 ◽  
Vol 22 (1) ◽  
pp. 105-126
Author(s):  
Maria Arbatskaya ◽  
Hugo M Mialon
Keyword(s):  
Host Country ◽  
Foreign Firm ◽  
Foreign Firms ◽  
Host Countries ◽  
Foreign Corrupt Practices Act ◽  
Total Investment ◽  
The Impact ◽  
The U.S

Abstract The Foreign Corrupt Practices Act (FCPA) prohibits U.S.-related firms from making bribes abroad. We analyze the FCPA’s effects in a model of competition between a U.S. and foreign firm for contracts in a host country. If the FCPA only applies to the U.S. firm, it reduces that firm’s competitiveness and either increases bribery by the foreign firm or reduces overall investment. If the FCPA also applies to foreign firms, it reduces total bribery, and in host countries with high corruption levels, it increases total investment. The model suggests that the FCPA will deter bribery and stimulate investment while not disadvantaging U.S. firms if its enforcement is aimed at firms who engaged in bribery in highly corrupt countries and whose main competitors are also subject to the FCPA.

Cause-related marketing for successful cross-border post-acquisition performance

2019 ◽  
Vol 37 (4) ◽  
pp. 695-712 ◽  
Author(s):  
Michela Matarazzo ◽  
Riccardo Resciniti ◽  
Biagio Simonetti
Keyword(s):  
Negative Influence ◽  
Positive Influence ◽  
Target Firm ◽  
Content Type ◽  
Repurchase Intentions ◽  
Cross Border ◽  
Cause Related Marketing ◽  
The Impact ◽  
Moderating Role

Purpose Building on the scant literature on cross-border acquisitions (CBAs) in the consumer perspective, the purpose of this paper is to investigate the impact of the acquirer’s cause-related marketing (CRM) on consumers’ repurchase intentions of the products of the post-acquisition target. In addition, the study aims at analyzing the moderating role of acquirer’s CRM on the relationship between corporate ability (CA) and country image (CI) on consumers’ repurchase intentions of the products of the post-acquisition target. Design/methodology/approach Drawing on a sample of Italian consumers (n=351), the authors examined the roles played by the acquirer’s CRM on consumer behaviour by considering an Italian target firm with a high reputation and comparing eight foreign acquiring firms with different combinations of CRM (poor/good), CA (poor/good) and CI (high/low). Findings The authors found that CRM, CA as well as CI have a significant impact on Italian consumers’ intention to repurchase the products of the post-acquisition target. Furthermore, it is shown that good CRM reduces the negative influence of a poor CA and a low CI on post-acquisition repurchase intentions and strengthen the positive influence, thus confirming the moderating role of CRM. Originality/value The research investigates, in the context of CBAs, the impact of the acquirer’s CRM on the host country consumers’ repurchase intentions after the CBA, which has not previously been examined. It can help managers to understand the conditions under which CBAs will be favourably evaluated.

The new European crowdfunding regulation: facilitating cross-border services

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Marco Brand
Keyword(s):  
European Union ◽  
Financial Services ◽  
Business Models ◽  
Service Providers ◽  
The European Union ◽  
Content Type ◽  
Cross Border ◽  
Funding Sources ◽  
Capital Markets Union ◽  
The Impact

Purpose To explain the new Crowdfunding Regulation to market participants and to describe the impact of the Crowdfunding Regulation on current crowdfunding business models in the European Union. Design/methodology/approach This article provides an overview of the new Crowdfunding Regulation with a focus on the provisions concerning cross-border services (“European Passport”) and the new authorization requirements for crowdfunding service providers. Findings In particular the introduction of the European passport will open new funding sources for project owners. This together with the harmonized authorization requirements of crowdfunding service providers is expected to contribute to further growth of the crowdfunding market in the European Union. The Crowdfunding Regulation is a further step on the way to a Capital Markets Union in Europe and regulates crowdfunding for the first time on a European level. Practical implications The Crowdfunding Regulation does not cover all existing crowdfunding business models in Europe (e.g., consumer as project owners and qualified subordinated loans are exempted). Insofar, the rules of the Member States continue to apply with the consequence of a partial fragmentation of applicable regulations. Originality/value Expert guidance from experienced financial-services lawyer.

scholarly journals Determinants of Value Creation in Cross-Border M&As: The Case of the Software Industry

2018 ◽  
Vol 13 (4) ◽  
pp. 183
Author(s):  
Alberto Pezzi
Keyword(s):  
Empirical Evidence ◽  
Firm Size ◽  
Value Creation ◽  
Software Industry ◽  
Growth Opportunities ◽  
Target Firm ◽  
Financial Measures ◽  
Software Market ◽  
Cross Border ◽  
Complementary Nature

This study specifically focuses on the software market and tries to identify the sources that intensify equity investments through merger and acquisition (M&A) paths. Increasing the firm size and accessing new growth opportunities is particularly significant in the software industry. Consistent with this view, this work focuses on the cross-border strategies that could be used to manage value creation processes. The results found are based on the fact that diversification of the geographic market (acquiring cross-border technology) is relevant to the positive answers given by the stock markets. Moreover, the age of the target firm strongly influences M&A decisions and the younger the target firm is, the higher the possibility of creating value, but this variable increases uncertainty in the evaluation of the target firm, decreasing the purchase offers. The complementary nature between the acquiring and the target firm and the size of the investing firm influence market return and appear to be linked. These results provide empirical evidence on the use of financial measures to determine the goodness of an acquisition but, above all, they provide a new reading of the evaluation of the complementary nature between the buyer and the target firm.

scholarly journals The Influence Of Corporate Governance, Capital Structure, and Company Size on The Company's Financial Performance

2021 ◽  
Vol 5 (2) ◽  
pp. 98-108
Author(s):  
Muhammad Abdul Izzatur Rahman ◽  
Subagio Subagio
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Financial Performance ◽  
Firm Size ◽  
Financial Services ◽  
Good Governance ◽  
Positive Impact ◽  
Company Size ◽  
Bank Capital ◽  
The Impact

This study aims to examine the effect of the implementation of corporate governance, capital structure, and firm size on the financial performance of banking companies. The implementation of good corporate governance is an obligation that must be carried out by companies which already have guidelines from the Financial Services Authority and other institutions. In fact, not all companies have applied good governance even though it can improve the performance of the company so it becomes interesting to study the impact of good governance implementation in Indonesia. This study uses panel data regression analysis with research samples from banking companies listed on the Indonesia Stock Exchange (IDX) from 2017 to 2019. The results of the study as overall show that corporate governance, capital structure and firm size have a positive effect on the company's financial performance. Managerial ownership as corporate governance proxy has a significant positive impact on financial performance partially. Keywords: bank, capital structure, corporate governance, company size

Politics, culture and M&As’ transaction completion

2018 ◽  
Vol 9 (3) ◽  
pp. 264-288
Author(s):  
Shi Li ◽  
Shizhong Huang
Keyword(s):  
Host Country ◽  
Diplomatic Relations ◽  
Chinese Enterprises ◽  
Content Type ◽  
Cultural Perspectives ◽  
Cross Border ◽  
Foreign Governments ◽  
New Research ◽  
The Impact ◽  
Diplomatic Relationship

Purpose Mergers and acquisitions (M&As) dominated by Chinese enterprises have become increasingly conspicuous and prevalent in recent years. However, many of them were obstructed by foreign governments on the ground of “Threating National Security”. Overseas acquisition is a crucial step of Chinese Government’s “Going-Out” strategy, so analyzing the attribution of its success and failure is very important. Design/methodology/approach This paper adopts empirical study method to analyze the factors from political and cultural perspectives based on a sample of 327 cross-border M&A transactions made by all listed companies in China from 1997 to 2010. Findings The result shows higher failure rate for those acquisition targets which could be classified as political sensitive assets; meanwhile, positive diplomatic relations and higher bilateral trust between China and the host country will facilitate the M&A transaction. Originality/value This paper offers a new research angle on cross-border M&As, which is the impact of culture factors, as well as diplomatic relationship, bilateral trust and war history between China and the host country on M&A transactions. This paper also constructs several ways of measuring the diplomatic relationship between countries.

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