Impact of Strategic Alliances on Firm Valuation.

Das, Somnath; Sen, Pradyot K.; Sengupta, Sanjit

doi:10.2307/256895

Cited by 356 publications

(206 citation statements)

References 25 publications

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“…All else being equal, it is possible that such differences contribute asymmetrically to partners' future rent stream. For example, Das, Sen, and Sengupta (1998) argued that, in high-growth industries, firms entering into R&D alliances may stand to gain more than firms entering into marketing alliances. The latter types of alliances may have relatively greater utility in mature or declining industries (Hagedoorn, 1993).…”

Section: Host Country Political Riskmentioning

confidence: 99%

How do international joint ventures create shareholder value?

2000

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Section: Host Country Political Riskmentioning

confidence: 99%

How do international joint ventures create shareholder value?

2000

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“…First, we consider six attributes (i.e., R&D, licensing, manufacturing, financing, marketing agreements, and technology transfer and integration) of the S-As which may affect the stock prices of the partnering firms around the announcement day. To determine the effect of the type of S-As (Das et al, 1998), we divide those S-As events into four types: technical, manufacturing, marketing, and other. Second, relative size is an important factor when forming an S-As between a larger firm and a smaller firm on which the larger firm is dependent for innovative technologies or rare resources.…”

Section: Research Hypothesismentioning

confidence: 99%

What Do Investors Care about in Strategic Alliances? An Empirical Study in the US and Japan

Hsu¹,

Chiang²,

Wang³

2013

IBR

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This study investigates investor concerns in the formation of strategic alliances, specifically concerns regarding opportunistic behavior and partner capabilities at the announcement of the alliance. Consistent with prior studies, our results show that both two partners gain in terms of abnormal returns and firm size, but that these benefits disappear within few days following the announcement, indicating that the market takes a dim view of alliances between large companies. The results suggest that investors are mostly concerned with short-term gains from speculation, rather than the ability of the alliance to increase long-term value.

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“…2 One popular type of alliance, other than the information sharing alliance, is the marketing alliance. Such alliances are typically formed between partners producing complements in the market place (Bucklin and Sengupta 1993;Das et al 1998) and require sharing of information, however focused on downstream activities such as sales and customer service (Brahy 2006;Hagedoorn 1993).…”

Section: Inter-organizational Alliances and Stock Market Responsesmentioning

confidence: 99%

“…In the recent past, a few studies have focused on the implication of alliance arrangements on the firm value of partners (e.g. Das et al 1998;Lorange and Roos 1991;Parkhe 1993). However, the results are mixed.…”

Section: Inter-organizational Alliances and Stock Market Responsesmentioning

confidence: 99%

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Interorganizational information sharing in the airline industry: An analysis of stock market responses to code-sharing agreements

2007

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This paper addresses the issue of inter-organizational information sharing alliances and their impacts on firm values from the perspective of inter-organizational coordination between partners in the airline industry setting. We investigate the shareholder wealth effects of inter-organizational information-sharing alliance arrangements, using 131 code-sharing agreements in the airline industry during 1984-1997. Employing event study methodology we found that the information sharing alliances between similar partners did create positive value in terms of stock returns at the time of alliance announcements to major US airlines. However, alliances between dissimilar partners resulted in significant losses of shareholder value to the major airlines. These results strongly support our main hypotheses that information-sharing alliances are successful and the benefits of such alliances are realized only when the coordination difficulties can be effectively dealt with.

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Impact of Strategic Alliances on Firm Valuation.

Cited by 356 publications

References 25 publications

How do international joint ventures create shareholder value?

How do international joint ventures create shareholder value?

What Do Investors Care about in Strategic Alliances? An Empirical Study in the US and Japan

Interorganizational information sharing in the airline industry: An analysis of stock market responses to code-sharing agreements

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