Acquisitions and the evolution of operational performance across the firm

Research output: Contribution to conferencePaperpeer-review

Abstract

Manufacturing firms frequently expand their production capacity through the acquisition of industrial units. How are the different existing units in the acquirer company affected by the acquisition of another facility? I argue that two important factors to understand the effects of acquiring another unit are geographic proximity and operational similarity. Using a unique dataset from a family-owned Brazilian agribusiness company, I find that an existing unit that is geographically close to a recently acquired unit experiences a decrease in its performance. In contrast, an industrial unit that is operationally similar to an acquiree experiences an increase in its operational performance. The evidence also shows that these two effects tend to decrease over time. Finally, the size of the existing unit counteracts these effects. The results illustrate the complexity of the relationship between acquisition events and performance across the firm. The acquisition of an industrial unit has different effects on the existing units in the acquirer company.

Original languageEnglish
DOIs
StatePublished - 2009
Event69th Annual Meeting of the Academy of Management, AOM 2009 - Chicago, IL, United States
Duration: 7 Aug 200911 Aug 2009

Conference

Conference69th Annual Meeting of the Academy of Management, AOM 2009
Country/TerritoryUnited States
CityChicago, IL
Period7/08/0911/08/09

Keywords

  • Acquisitions
  • Agribusiness
  • Operational performance

Fingerprint

Dive into the research topics of 'Acquisitions and the evolution of operational performance across the firm'. Together they form a unique fingerprint.

Cite this