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Conference Paper: Effects of R&D Investments and Signals on International Acquisitions: Evidence from IPO Firms
Title | Effects of R&D Investments and Signals on International Acquisitions: Evidence from IPO Firms |
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Authors | |
Issue Date | 2014 |
Publisher | Academy of Management (AOM). |
Citation | The 74th Annual Meeting of the Academy of Management "The Power of Words", Philadelphia, PA, 1-5 August 2014 How to Cite? |
Abstract | We investigate how intangible assets in the form of R&D influence firms’ propensities to engage in international acquisitions. On the one hand, previous research has noted that the tacit and redeployable nature of R&D investments may enable firms to expand their operations overseas and create value from international acquisitions. On the other hand, R&D investments can raise the cost of collecting and analyzing information to evaluate firms’ resources and prospects, which can hamper their ability to finance and execute international M&A deals. In the context of international acquisitions undertaken by firms just completing their initial public offerings (IPOs), we argue and find that the IPO firm’s engagement in post-IPO international acquisition activity is generally negatively related to its R&D intensity. This effect contrasts previous arguments on the internalization advantages possessed by R&D-intensive firms. However, firms having market signals on their resources and prospects can mitigate information problems and carry out cross-border acquisitions. We therefore identify an unexamined tradeoff that intangible assets present in the international M&A context and how market signals can facilitate cross-border transactions. |
Description | Paper Session: Internationalization: Cross-Border Mergers and Acquisitions |
Persistent Identifier | http://hdl.handle.net/10722/201493 |
DC Field | Value | Language |
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dc.contributor.author | Wu, C | en_US |
dc.contributor.author | Reuer, J | en_US |
dc.date.accessioned | 2014-08-21T07:28:46Z | - |
dc.date.available | 2014-08-21T07:28:46Z | - |
dc.date.issued | 2014 | en_US |
dc.identifier.citation | The 74th Annual Meeting of the Academy of Management "The Power of Words", Philadelphia, PA, 1-5 August 2014 | en_US |
dc.identifier.uri | http://hdl.handle.net/10722/201493 | - |
dc.description | Paper Session: Internationalization: Cross-Border Mergers and Acquisitions | - |
dc.description.abstract | We investigate how intangible assets in the form of R&D influence firms’ propensities to engage in international acquisitions. On the one hand, previous research has noted that the tacit and redeployable nature of R&D investments may enable firms to expand their operations overseas and create value from international acquisitions. On the other hand, R&D investments can raise the cost of collecting and analyzing information to evaluate firms’ resources and prospects, which can hamper their ability to finance and execute international M&A deals. In the context of international acquisitions undertaken by firms just completing their initial public offerings (IPOs), we argue and find that the IPO firm’s engagement in post-IPO international acquisition activity is generally negatively related to its R&D intensity. This effect contrasts previous arguments on the internalization advantages possessed by R&D-intensive firms. However, firms having market signals on their resources and prospects can mitigate information problems and carry out cross-border acquisitions. We therefore identify an unexamined tradeoff that intangible assets present in the international M&A context and how market signals can facilitate cross-border transactions. | en_US |
dc.language | eng | en_US |
dc.publisher | Academy of Management (AOM). | - |
dc.relation.ispartof | Annual Meeting of the Academy of Management (AOM) | en_US |
dc.title | Effects of R&D Investments and Signals on International Acquisitions: Evidence from IPO Firms | en_US |
dc.type | Conference_Paper | en_US |
dc.identifier.email | Wu, C: chweiwu@hku.hk | en_US |
dc.identifier.authority | Wu, C=rp01631 | en_US |
dc.identifier.hkuros | 233485 | en_US |
dc.publisher.place | United States | - |