Mergers and Acquisitions in Africa: A Review and an Emerging Research Agenda

Ellis, Kimberly M.; Lamont, Bruce T.; Reus, Taco H.; Faifman, Leon

doi:10.1080/23322373.2015.1028274

Cited by 43 publications

(56 citation statements)

References 46 publications

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“…Our strong support for the negative effects of colonial ties on CBA ownership in Africa provides some evidence for Ellis et al's () assertion that colonial ties may play an important role in various aspects of the M&A process. Colonial ties may affect not only the ownership structure in deals, but also organizational justice perceptions before and after the deal, target managerial retention, and the quality of managerial and employee interactions.…”

Section: Discussionsupporting

confidence: 71%

Institutional determinants of ownership positions of foreign acquirers in Africa

Ellis

Lamont

Holmes

et al. 2017

Global Strategy Journal

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Research summary Using unique features of the African context and blending institutional, hostage, and transaction cost theories, we address gaps in our understanding of institutional determinants of ownership position in cross‐border acquisitions (CBAs) in emerging countries. We focus on two traditional institutional determinants: Informal and formal institutional distances between the two firms’ home countries and two determinants that are particularly acute in the African context: the colonial ties between and fractionalization of the two firms’ home countries. We find colonial ties and uncertainty avoidance distance, an indicator of informal institutional distance, are negatively related to ownership position. Conversely, we show that formal institutional distance and the host country's fractionalization positively influence ownership levels, but the latter effect is weakened when acquirers come from more fractionalized home countries. Managerial summary We examine the effects of four institutional factors that influence organizational decision‐making in the African context: (a) its colonial history, (b) differences in informal cultural norms, (c) differences in formal regulatory structures, and (d) ethnic and linguistic diversity within a country on the percentage of equity ownership that foreign acquirers hold in African target firms. Results indicate that this equity position is lower when colonial ties and greater differences in uncertainty avoidance exist between the acquirer's home country and the target African country. Conversely, foreign acquirers’ equity ownership positions are higher when there are greater formal regulatory differences between the two countries and the host country is more ethnically and linguistically diverse, though the latter effect is reduced when the acquirer is from a home country that is also diverse.

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Section: Discussionsupporting

confidence: 71%

Institutional determinants of ownership positions of foreign acquirers in Africa

Ellis

Lamont

Holmes

et al. 2017

Global Strategy Journal

Self Cite

View full text Add to dashboard Cite

show abstract

“…In addition to national, regional, and organizational differences, there are also tribal and religious differences across and within African countries to take into consideration, making any type of cross-border partnership complex (Ellis et al, 2015;Ovadje, 2016, in this issue). In the Nigerian firm Ovadje (2016, in this issue) studied, top management learnt the hard way how much culture mattered, realizing that having local management in their foreign subsidiaries made all the difference.…”

Section: Implications For Cross-border Partnerships In Africamentioning

confidence: 97%

“…Although we could assume that patterns of historical and social dominance would be more problematic in M&As than alliances, in the BP-Statoil Alliance that we studied, Statoil was explicitly asked by BP to take lead on the Nigerian project for precisely this reason. A realization among the alliance partners that historical actions and wrongdoings at a national level could have an impact on today's business activities at the organizational level, is key knowledge to factor in when planning and realizing strategic alliances in emerging countries in general, and in Africa in particular (see also Ellis et al, 2015 for an enlightening discussion on this topic).…”

Section: Implications For Cross-border Partnerships In Africamentioning

confidence: 99%

“…Ellis, Lamont, Reus, & Faifman (2015) point to the importance of human resource management issues in their review of mergers and acquisitions (M&As) in Africa. We observed in our study that, with respect to the Nigerian site staff, the lack of clarity surrounding career tracks, promotion, and opportunities for job rotation within the alliance was a source of real concern.…”

Section: Implications For Cross-border Partnerships In Africamentioning

confidence: 99%

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Making Sense of Changing Hats: A Study of the Nigeria, Vietnam, and Azerbaijan/Kazakhstan Projects within the Norwegian Statoil and British BP Strategic Alliance

Lerpold

Zander

2016

Africa Journal of Management

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To explore group-based identities and collective sensemaking in the context of a cross-border alliance, a qualitative exploratory study was initiated. The emphasis was on interpretation of issues, within and around an interfirm partnership and the alliance process, perceived by those involved as important. The BP and Statoil strategic alliance, formed to carry out joint oil and gas exploration and development in Nigeria, Vietnam and Azerbaijan/Kazakhstan, provided 52 interviews with staff from both partner headquarters and team members from the three projects. By studying an alliance process from multiple perspectives, it was possible to identify differences in sensemaking across different groups of employees. The organizational level (the alliance business unit level and the alliance team level) proved to be more important for shared sensemaking of the alliance process than group identities, such as nationalities, companies or locations. The alliance business unit level had been tasked with strategically developing and shaping the alliance, while the alliance teams had the operational responsibility for the project. The main theoretical implication is the primacy of project team-based identity to sensemaking regarding critical issues, emphasizing the importance of developing an alliance "supra-identity". Implications for interfirm partnerships in Africa and Asia are also addressed.

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“…Systematically exploited over the centuries for slave labour and raw materials, our mental map of Africa is often shaped by the common world map that depicts the continent as somewhat smaller than Europe or the United States. Mergers and acquisitions are on the rise, even defying the impact of the 2008 global recession (Ellis, Lamont, Reus, & Faifman, 2015). This interest represents a confluence of a number of important elements.…”

mentioning

confidence: 99%

Sustainable management and managing sustainability: The continued challenges of the African continent

Honig

Acquaah

2016

Can J Adm Sci

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Mergers and Acquisitions in Africa: A Review and an Emerging Research Agenda

Cited by 43 publications

References 46 publications

Institutional determinants of ownership positions of foreign acquirers in Africa

Institutional determinants of ownership positions of foreign acquirers in Africa

Making Sense of Changing Hats: A Study of the Nigeria, Vietnam, and Azerbaijan/Kazakhstan Projects within the Norwegian Statoil and British BP Strategic Alliance

Sustainable management and managing sustainability: The continued challenges of the African continent

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