Mergers and Acquisitions as a Response to Intra-Industry Dependence

Item Type Book Section
Abstract

A firm's behavior is constrained by its access to resources owned or controlled by different constituencies in its environment. Mergers and acquisitions are one way to proactively manage these resource dependencies. Research on resource dependence reducing merger and acquisition patterns provides an important cornerstone of resource dependency theory and a basis of our present knowledge of the aggregate industry-level merger and acquisition patterns. However, due to the predominant focus on inter-industry merger and acquisition patterns in earlier research, much less is known as to whether the same logic could also be applied to explain intra-industry merger and acquisition patterns. In this chapter, we extend the resource dependence results to an intra-industry context. In particular, we show that mergers and acquisitions among pharmaceutical firms tend to take place among firms with technological and competitive interdependencies. To distinguish our finding from the competing resource scale and scope explanations, we show that the likelihood of a resource dependence reducing acquisition is moderated by the crowding of firms' technological positions and prior alliance ties. Consistent with the resource dependence explanation, both weaken the effect of overlapping technological positions even though both alliance ties and crowding otherwise are positively related to merger and acquisition patterns in line with the social structural explanations

Authors Schildt, Henri; Laamanen, Tomi & Keil, Thomas
Editors Finkelstein, Sydney & Cooper, Cary L.
Language English
Subjects business studies
HSG Classification contribution to scientific community
Refereed No
Date 2010
Publisher Emerald
Place of Publication United Kingdom
Series Name Advances in mergers and acquisitions
Volume 1st ed
Number v. 9
Page Range 105-133
Number of Pages 29
Title of Book Advances in Mergers and Acquisitions
Publisher DOI 10.1108/S1479-361X(2010)0000009008
Depositing User Prof. Dr. Tomi Laamanen
Date Deposited 25 Jan 2013 16:09
Last Modified 23 Aug 2016 11:15
URI: https://www.alexandria.unisg.ch/publications/219947

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Citation

Schildt, Henri; Laamanen, Tomi & Keil, Thomas: Mergers and Acquisitions as a Response to Intra-Industry Dependence. In Finkelstein, Sydney & Cooper, Cary L. (ed.): Advances in Mergers and Acquisitions. United Kingdom : Emerald, 2010, S. 105-133.

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https://www.alexandria.unisg.ch/id/eprint/219947
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