Mergers and acquisitions (M&As) have become an important strategy for firms to acquire the needed resources for their survival and development in today's hypercompetitive business environment. In 2007 global M&As reached historical levels at $4.83 trillion of which U.S. deals stood at $1.6 trillion (Financier Worldwide 2008). Nonetheless, from 50 percent to almost 80 percent of M&As fail to create shareholder value (Homberg, Rost, and Osterloh 2009). Researchers have attempted to explain M&A success and failure from different perspectives. A traditional scale-based view suggests that M&As help reduce costs, improve efficiency, and thus increase profits due to economies of scale (e.g., DePamphilis 2008). A product market-based view argues that compatibility of product portfolios and target markets of merging firms enhances firm value (e.g., Datta, Pinches, and Narayanan 1992). A resource-based view puts forward the idea that M&A strategic actions facilitate firms' acquisition and reconfiguration of their resources to quickly adapt to environmental changes (e.g., Homburg and Bucerius 2005).
展开▼
