Fei Li’s research while affiliated with Zhejiang University and other places

Overseas mergers and acquisitions (M&A) proposed by companies from emerging economies have been aiming to secure outward technology sourcing from developed countries in order to improve their technology innovation abilities in recent years. This paper proposes a comprehensive analytical framework of post-merger integration’s influence on technology innovation by global game modeling. We show how different resource similarity and resource complementarity backgrounds of the acquirer and target companies can affect post-merger strategies and technology innovation output through multi-stage analysis with an asymmetrical payoff structure. We focus on two main dimensions of post-merger integration, which are integration degree and target autonomy. Equilibrium analysis that is based on potential innovation output signals show that resource similarity has a positive relation with integration and a negative relation with target autonomy in overseas M&A; however, resource complementarity has the opposite effects compared with resource similarity. The positive interaction between resource similarity and complementarity will trigger more M&A and increase the degrees of integration and autonomy; M&A integration has a positive impact on technology innovation output. The innovation growth of the acquiring company is affected by the effectiveness of the post-merger process and the interaction of substitution elasticity with resource potential difference. Our study provides insight into the factors driving post-merger decisions and contributes to a multi-stage resource-based understanding of technology innovation induced by overseas post-merger integration.

In this paper, we examine the match between resource relatedness and post-merger integration on technology innovation of acquiring firms to find the rationale behind technology-sourcing cross-border mergers and acquisitions (M&As) of Chinese multinational enterprises. Using a sample of 88 Chinese technology-sourcing cross-border M&As, we find that the acquirer will improve technology innovation when greater resource similarity between the acquirer and target firms is matched with a high integration degree and a low target autonomy level. Meanwhile, the acquirer can improve technology innovation when greater resource complementarity is matched with a low level of integration degree in technology-sourcing cross-border M&As. This paper provides the acquiring firms with fresh ideas of how to make the integration decisions of technology-sourcing overseas M&As. We hope to help multinational enterprises to achieve more outstanding technology innovation performance through technology-sourcing overseas M&As in an intense global competitive environment.

The abilities to efficiently identify potential innovation profits and form an optimal post-merger strategy are important in evaluating overseas merger and acquisition (M&A) performances. The paper uses a global game with asymmetric payoff structure and multi-agent simulation method to analyze the optimal overseas post-merger strategy. We model three stages of the M&A processes: merger decision stage, post-merger integration stage, and technology innovation after M&A, to analyze how different resource similarity and resource complementarity of the two companies influence the degree of optimal post-merger integration and target autonomy as well as technology innovation profit after M&A. The agent-based simulation shows that in overseas M&As, resource similarity has a positive relation with integration and a negative relation with target autonomy; however, resource complementarity has the opposite effect. The negative interaction effect between resource similarity and complementarity will decrease the degree of integration. In high resource similarity and low resource complementarity M&As, a high integration degree and low target autonomy will maximize innovation profit, while for high resource similarity and high resource complementarity M&As, a medium integration degree and target autonomy is best for innovation profit. For low resource similarity and high resource complementarity M&As, a low integration degree and high target autonomy will be the best post-merger strategy. Model outputs are robust to variations of the parameters.