Paper #231

Título:

Multinationals, technology networks and international takeovers

Autores:

M. Àngels Oliva y Luis Rivera-Bátiz

Data:

Septiembre 1997

Resumen:

We formulate a knowlegde--based model of direct investment through mergers and acquisitions. M&As are realized to create comparative advantages by exploiting international synergies and appropriating local technology spillovers requiring geographical proximity, but can also represent a strategic response to the presence of a multinational rival. The takeover fee paid tends to increase with the strength of local spillovers which can thus work against multinationalization. Seller's bargaining power increases the takeover fee, but does not influence the investment decision. We characterize losers and winners from multinationalization, and show that foreign investment stimulates research but could result in a synergy trap reducing multinationals' profits.

Palabras clave:

multinationals, spillovers, networks, mergers and acquisitions

Códigos JEL:

C78, D43, F23, G34, O32

Área de investigación:

Finanzas y Contabilidad

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