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- Title
PREDICTED CHANGE IN OPERATIONAL SYNERGY AND POST-ACQUISITION PERFORMANCE OF ACQUIRED BUSINESSES.
- Authors
Brush, Thomas H.
- Abstract
The 1980s acquisitions are widely believed to have unwound the conglomerate boom of 1960s through horizontal mergers, yet alternative forms of unwinding have not been examined. This study tests the explanation that changes in the opportunity to share resources and activities among businesses of the firm may have contributed to post acquisition performance improvements in the recent acquisition wave. After estimating sources of competitive performance that are due to these changes within each of 356 manufacturing industries, the study calculates predictions of changes in competitive performance for each acquired business between 1980 and 1984. These predictions are positive and in turn are positively associated with change in competitive performance between 1984 and 1986. This finding highlights the importance of resource sharing and activity sharing in these acquisitions and leads to the reexamination of theories for the second acquisition wave that are supported by the finding of horizontal acquisitions.
- Subjects
MERGERS &; acquisitions; CONGLOMERATE corporations; MANUFACTURING industries; HORIZONTAL merger; RESOURCE management; PERFORMANCE evaluation; ORGANIZATIONAL change; COMPETITION; FINANCIAL performance
- Publication
Strategic Management Journal (John Wiley & Sons, Inc.) - 1980 to 2009, 1996, Vol 17, Issue 1, p1
- ISSN
0143-2095
- Publication type
Article
- DOI
10.1002/(SICI)1097-0266(199601)17:1<1::AID-SMJ782>3.0.CO;2-W