The impact of industry-wide and target market environmental hostility on entrepreneurial leadership in mergers and acquisitions

Abstract

Based on survey data from 115 acquisitions completed between 2008 and 2011 by European acquirers from German-speaking countries, we find evidence that entrepreneurial leadership is a strong predictor of exploration and a weaker but significant driver of exploitation outcomes following M&A. Industry-wide environmental hostility negatively impacts the influence of entrepreneurial leadership on exploitation. Target market environmental hostility negatively impacts the influence of entrepreneurial leadership on exploration. Thus, while entrepreneurial leadership is a key success factor of M&A performance by increasing both, post-merger exploration and exploitation, acquirers need to take environmental conditions at the industry and market level into account.

Entrepreneurial Leadership and Sustainable Performance of Manufacturing SMEs in Malaysia: The Contingent Role of Entrepreneurial Bricolage

“…First, the result confirms that EL and ECSPF have an insignificant relationship. Although there is no empirical support for the direct relationship between EL and ECSPF, this finding is in contrast with [85], who stated that EL is positively influencing acquisition performance, which indirectly influences economic performance through returns on investment, sales, and equity. This finding also contradicts the previous literature which stated that sustainable practices positively enhance economic performance [22,57,86].…”

Navigating the New Normal: Political Affinity and Multinationals’ Post‐Acquisition Performance

“…Second, during post‐acquisition integration, foreign acquirers face greater scrutiny to demonstrate cooperation (Strobl et al, ). Political affinity can bring positive benefits in terms of external stakeholders’ ‘national preferences’ or ‘consumer sentiments’ towards the acquiring MNEs (Enderwick, ).…”

“…In addition, the cascading effect of host‐home country’s political interests on MNEs’ cross‐border acquisition performance varies, depending on the economic conditions of the home and host markets. Prior work on the post‐acquisition integration of M&A events primarily focuses on issues of internal integration (e.g., Birkinshaw et al, ; Schweizer, ) while less attention has been focused on the degree to which the acquirers are exposed to uncertainty created by factors in the external environment (Strobl et al, ). By studying the interaction of political affinity with home and host country economic conditions, we highlight the importance of understanding the intricacies of the home‐host political and economic environment during the post‐acquisition integration period.…”

Does changing contexts affect linkages throughout the mergers and acquisition process? A multiphasic investigation of motives, pre‐ and post‐acquisition and performance

“…We initially contacted by phone the CEO of the acquiring firm and explained the purpose of our research, asking for his/her participation in our research. CEOs and top managers, in general, are considered to have the best knowledge of major events such as acquisitions (e.g., Ellis, Reus, & Lamont, ; Strobl et al, forthcoming; Zaheer, Castañer, & Souder, ). In cases where the CEO was unavailable to participate in the research, we asked him/her to name the key manager with the most intimate knowledge of the acquisition process (Ellis et al, ).…”