Post-acquisition Integration Management and Takeover Performance

Abstract

In spite of a multitude of prior empirical investigations on factors explaining variance in company performance after a takeover each single study has typically incorporated only a narrow range of post-acquisition integration (PAI) design subfields. This paper applies a more comprehensive approach by developing hypotheses with regard to correlations between employee perceptions of six PAI subfields and their assessments of two acquisition performance dimensions. The hypotheses are empirically tested using data obtained in two standardised written employee surveys conducted about one year apart after a horizontal takeover in the information and communication technology industry in Germany. Responses were collected from 570 and 534 employees who worked for the merged organisation. PLS structural equation modeling results show that paths from employee perceptions of the quality of executive leadership in the PAI process, the degree of integration of business processes and corporate cultures as well as adequacy of integration speed to two performance constructs (internal reorganisation success, achievement of strategic objectives) are significantly positive. The results support the view that PAI investigations perform well with attempts combining various lenses of scholarly corporate acquisition research. Implications of the findings are discussed for future studies on PAI measures and for PAI management practice.