Effects of M&As on innovation performance: empirical evidence from Chinese listed manufacturing enterprises

ABSTRACT

With the acceleration of the economic globalisation process, worldwide market competition is becoming increasingly intense. To remain impregnable in face of fierce competition, Merger and Acquisition (M&A) become the important means to obtain technology, gain core competitiveness, and increase market share. Therefore, studying the effects of M&As on innovation performance has a certain practical significance. With a sample of 96 M&A events of Chinese listed manufacturing enterprises from 2004 to 2011, we find that horizontal M&A and conglomerate M&A can reduce innovation performance, while vertical M&A has no significant effect thereon. Technological M&A has a positive effect on the innovation performance of the acquiring firm, while the effect of non-technological M&A thereon is negative. In technological M&As, entered technological M&A will lower innovation performance, complementary technological M&A can increase innovation performance, while upgraded technological M&A has no significant effect on innovation performance.

KEYWORDS:

• M&A
• technological M&A
• innovation performance

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Chaoliang Ma is a postdoctor of School of Management of the University of Science and Technology of China. His primary research interests are innovation management and crowdfunding.

Zhiying Liu is a professor of School of Management of the University of Science and Technology of China. His research interests include innovation management, technology innovation, and crowdfunding.

Additional information

Funding

This project was supported by the National Natural Science Foundation of China [71472172] and the Ministry of Education of Humanities and Social Science Project [14YJA630035].