The Innovation Perspective of the Acquirers: Empirical Evidence Regarding Patent-Driven M&As

Abstract

Economic entities get involved in mergers and acquisitions (M&As) because they are interested in external growth strategies which can lead to an increase in the wealth of the shareholders of the participating entities. In M&As, from an acquirer or a target’s perspective, a company brings its resources, which can be material or immaterial (knowledge). In the post-M&A phase, through the integration process the shareholders expect synergy gains, or that the combined firms to report efficiency gains higher than if they would activate separately. In nowadays, in a boundaryless economy, one of the most appreciated resources is knowledge. In this respect, the intangible assets, in general, and patents, in particular, are the accounting representation of knowledge in a company. They are also considered to be predictors for the deal value paid to the target company. To those we add the size of the target company, its core activity and the value of the research and development expenses, the latter being a significant mediator variable for the proposed models.

Determinant Factors of M&As in Emerging Economies: The Impact of Financial Performance in Romanian Minority Acquisitions

“…In this context, the target company accounting figures may justify the opportunity of an investment in terms of profitability and revenues that reflect the M&A success (Rozen-Bakher 2017;Sirower and Lipin 2003). Seeing the synergy success in terms of revenue increase is more of a managerial approach than an accounting one, given the fact that the decrease in costs may also lead to profitability in terms of accounting statements, but the revenue increasing may be connected to increase in market share (Bauer and Matzler 2013) or in innovation (Wubben et al 2016;Aevoae et al 2019). Also, the success of an M&A can be assessed through the degree in which the financial targets are met in a time frame, established during the pre-acquisition phase, in terms of expected returns and costs (Dilshad 2012).…”

“…Researchers around the world have taken an interest in examining the external growth strategies of companies, focusing on mergers and acquisitions (M&As), with emphasis on those involving companies located in developed economies (Park 2019;Yang and Deng 2017;Lin et al 2009;Cheng and Yang 2017;Caiazza et al 2017). There are also studies that prove the choice for these types of economies that host the acquiring or the target companies involved (Lucas 1990;Aevoae et al 2019). On the other hand, globalisation and rapid economic growth determined a new strategic approach for companies, which have started to search for investment opportunities in emerging economies.…”

Rethinking the Role of M&As in Promoting Sustainable Development: Empirical Evidence Regarding the Relation Between the Audit Opinion and the Sustainable Performance of the Romanian Target Companies

“…In the second case, the motives are more varied and start from providing the acquirers with a certain degree of influence over the target's decisions [14], to benefiting from the target's profitability, materialized under the form of dividends. To these, we may add sharing technology [15], developing joined products [16] or mitigating financial constraints [17].…”