The article examines how firms' institutional environments influence rivals' expected performance following horizontal M&A announcements of competitors. Grounded in institutional economics, we propose that institutional distance affects M&As' economic efficiency by influencing deal completion and creating subsequent differential costs and benefits post-deal completion. Our analysis of 124 international M&A announcements reveals that rivals’ performance is negatively affected by negative formal institutional distance between the acquirer and target, but positively affected by negative formal distance between the rival and acquirer. In addition, informal institutional distance between the acquirer and target has positive effect on rivals’ performance—though this effect vanishes for high-status acquirers.
Kalanoski, D., Cappa, F., Pinelli, M., Bonardi, J.-P. (2025). The Impact of International Mergers and Acquisitions on Rivals’ Performance: The Role of Formal and Informal Institutions. JOURNAL OF WORLD BUSINESS, 60(3) [10.1016/j.jwb.2024.101608].
The Impact of International Mergers and Acquisitions on Rivals’ Performance: The Role of Formal and Informal Institutions
Cappa F.;
2025-01-01
Abstract
The article examines how firms' institutional environments influence rivals' expected performance following horizontal M&A announcements of competitors. Grounded in institutional economics, we propose that institutional distance affects M&As' economic efficiency by influencing deal completion and creating subsequent differential costs and benefits post-deal completion. Our analysis of 124 international M&A announcements reveals that rivals’ performance is negatively affected by negative formal institutional distance between the acquirer and target, but positively affected by negative formal distance between the rival and acquirer. In addition, informal institutional distance between the acquirer and target has positive effect on rivals’ performance—though this effect vanishes for high-status acquirers.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
