Why do firms acquire external technologies? Understanding the motivations for technology acquisitions

Why do firms acquire external technologies? Previous research indicates that there are a wide variety of motivations. These include the need to acquire valuable knowledge-based resources, to improve strategic flexibility, to experiment), to overcome organisational inertia, to mitigate risk and uncertainty, to reduce costs and development time in new product development, and the perception that the firm has the absorptive capacity to integrate acquisitions. In this paper we provide an in-depth literature review of the motivations for the acquisition of external technologies by firms. We find that these motivations can be broadly classed into four categories: (1) the development of technological capabilities, (2) the development of strategic options, (3) efficiency improvements, and (4) responses to the competitive environment. In light of this categorisation, we comment on how these different motivations connect to the wider issues of technology acquisition. © 2010 IEEE.

Disentangling the Complexity of Early-Stage Technology Acquisitions

While tools have been developed to assist firms' decision making for bringing known products and components into the supply chain, fewer tools are available to guide the acquisition of earlier-stage technologies, which is a riskier proposition due to higher technological and market uncertainties. Through synthesis of literature in technology sourcing, open innovation, alliances, mergers and acquisitions, outsourcing, and technology and knowledge transfer and consultation with industry, this paper identifies critical issues that decision makers should consider before making an early-stage technology acquisition. Sixteen questions emerge to guide decision making, comprising internal, technology, and partner assessments. These questions allow a firm to disentangle the complexity of early-stage technology acquisitions and select the most appropriate targets.

Mergers and Acquisitions in Vietnam’s Emerging Market Economy, 1990-2009

This paper is the first major and thorough study on the M&A activities in Vietnam’s emerging market economy, covering almost entirely the M&A history after the launch of Doi Moi. The surge in these activities since mid-2000s by no means incidentally coincides with the jump in FDI and FPI inflows into the nation. M&A industry in Vietnam has its socio-cultural traits that could help explain economic happenings, with anomalies and transitional characteristics, far better than even the most complete set of empirical data. Proceeds from sales of existing assets and firms have mainly flowed into the highly speculative industries of securities, banking, non-bank financials, portfolio investments and real estates. The impacts of M&A on Vietnam’s long-term prosperity are, thus, highly questionable. An observable high degree of volatility in the M&A processes would likely blow outthe high ex ante expectations by many speculators, when ex post realizations finally arrive. The effect of the past M&A evolution in Vietnam has been indecisively positive or negative, with significant presence of rent-seeking and likelihood of causing destructive entrepreneurship. From a socio-economic and cultural view, the degree of positive impacts it may result in for domestic entrepreneurship will perhaps be the single most important indicator.

Mergers, Acquisitions, and Alliances

© 2012 by Oxford University Press. All rights reserved.This article considers the determinants and effects of M&As in the pharmaceutical industry, with a particular focus on innovation and R&D productivity. As is the case in other industries, mergers in the pharmaceutical field are driven by a variety of company motives and conditions. These include defensive responses to industry shocks as well as more proactive rationales, such as economies of scale and scope, access to new technologies, and expansion to new markets. It is important to take account of firms' characteristics and motivations in evaluating merger performance, rather than using a broad aggregate brushstroke. Research to date on pharmaceuticals suggests considerable variation in both motivation and outcomes. From an antitrust policy standpoint, the larger horizontal mergers in pharmaceuticals have run into few challenges from regulatory authorities in the United States and the European Union, given the option to spin off competing therapeutic products to other drug firms.