Kochura, Oleksandra, Mirc, Nicola and Lacoste, Denis (2022) What follows what? Sequences and combinations of acquisitions and divestitures. In: Acquisitions and Corporate Strategy: Alliances, Performance, and Divestment Edited By David R. King D. King (ed.). Series “Routledge research in strategic management” Chapter 3. London ISBN 9781032036366

Abstract

We review sequential corporate strategy patterns involving divestitures and acquisitions. We classify existing studies into acquisition-preceding-divestiture and divestiture-preceding-acquisition categories to identify four feasible interrelationships linking these two corporate restructuring tools. By acknowledging that acquisitions and divestitures are not definitive steps in resetting a firm’s boundaries, we posit that the value-enhancing mechanisms involved can be observed only if we look at the order of the actions taken. We attempt to understand the multifaceted nature of these sequences and choices to propose an integrated view of acquisitions and divestitures by recognizing the precedents for each restructuring tool. The performance implications of these sequences are not yet known but considering them can better explain the success or failure of strategic restructuring decisions.