Chinese cross-border acquisitions: An organizational learning perspective

Abstract

Are Chinese companies with prior acquisition experience more successful in completing M&A transactions in the cross-border context than Chinese firms with less experience? This study builds on behavioral learning theory to suggest that antecedent conditions determine whether prior experience has negative or positive effects on cross-border acquisition success. The study investigates the experience-based learning effect in the context of Chinese outward cross-border acquisitions. First, hypotheses are developed and empirically tested using data from 705 cross-border acquisitions by Chinese companies from 2002 to 2012. Second, results from the pre-acquisition phase suggest that prior domestic experience gained in Mainland China has a negative influence on the completion likelihood of a cross-border acquisition attempt. The results show that target-to-target industry similarity enhances the transfer of learning acquired from both domestic and foreign experience. Moreover, cultural distance inconsistently influences learning effects. The talk concludes with theoretical and managerial implications, limitations, and suggestions for future research.

Biography

Björn Michaelis is Adjunct Professor of Management and Organization at Kühne Logistics University. Before coming to KLU, Prof. Michaelis was a post-doc researcher and Habilitand at the UBS-Endowed Professorship for Strategic Management at Goethe University Frankfurt, Germany. At the Goethe University Frankfurt he received his post-doctoral qualification (habilitation) and was granted the "venia legendi" in Business Administration (2011-2015). Moreover, Prof. Michaelis was an Associate Professor of Organizational Behavior (2009-2011) and a Research Associate and doctoral student (2006-2009) at Heidelberg University, Germany. Gaining experience abroad he was a Visiting Fellow at the Graduate School of Business in Fontainebleau (France). His research interests include corporate strategy, mergers & acquisitions (M&A), joint ventures and strategic alliances, strategic human resource management, and leadership.