Extending Industry Specialization through Cross-Border Acquisitions

Frésard, Laurent, Hege, Ulrich and Phillips, Gordon (2017) Extending Industry Specialization through Cross-Border Acquisitions. The Review of Financial Studies, 30 (5). pp. 1539-1582.

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Official URL: http://tse-fr.eu/pub/31296


We investigate the role of industry specialization in horizontal cross-border merg- ers and acquisitions. We find that acquirers from more specialized industries in a country are more likely to buy foreign targets in countries that are less specialized in these same industries. The role of industry specialization in foreign acquisitions is more prevalent when contracting inefficiencies and exporting costs limit arms' length relationships. The economic gains in cross-border deals are larger when spe- cialized acquirers purchase assets in less specialized industries. These results are consistent with an internalization motive for foreign acquisitions, through which acquirers can apply localized intangibles on foreign assets.

Item Type: Article
Language: English
Date: 2017
Refereed: Yes
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 04 Jan 2017 12:31
Last Modified: 10 Apr 2018 12:59
OAI ID: oai:tse-fr.eu:31296
URI: http://publications.ut-capitole.fr/id/eprint/22666

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