Cultural Complexities in Cross Border Mergers & Acquisitions

Research Paper (postgraduate) from the year 2011 in the subject Business economics - Business Management Corporate Governance grade: none University of Pompeu Fabra (ESCI (School of International Trade) ) language: English abstract: Based on a review of pertinent literature the paper discusses the role and the complexities of cross-border mergers and acquisition in firms´ internationalization. The various stages that firms customarily go through as part of an international merger and acquisition process are outlined and debated from both a theoretical and practical perspective. Particular challenges related to the management of the post- merger integration process and complexities related to differences in national and organizational cultures organizational design and knowledge-structures between the acquirer and the target company are discussed. It is argued that appropriate management of the merging firms´ human resources as the merging firms´ smallest common denominator is the key to optimize the outcome of cross-border transactions and to achieve budgeted post-merger benefits. Based on the conceptual discussion the paper concludes with key recommendations for how to manage a cross-border deal to minimize risks and increase the probability of achieving the objectives.