Acquired, transferred and integrated knowledge: a study of M&A knowledge performance

Abstract

Purpose

The acquisition of knowledge through mergers and acquisition (M&A) may not create value—usually because the knowledge may not be transferred, or transferred but not integrated. The purpose of this paper to develop and test a theoretical model of knowledge and performance in the M&A process.

Design/methodology/approach

Theory, model and case analysis.

Findings

The literature review led us to distinguish between three main categories of knowledge along the different stages of the M&A process: acquired knowledge in the pre-merger stage; and transferred knowledge and integrated knowledge in the post-merger stage. The application of the model is illustrated in a case study of technology M&A, which includes data collected from annual reports before and after the merger.

Research limitations/implications

The model recommends acknowledging the differences between the acquired knowledge, transferred knowledge and integrated knowledge when examining the relationship between knowledge and performance in M&As. In addition, the model suggests considering several factors that influence future knowledge integration in the pre-merger stage. Ignoring the three categories and the factors may be the reason for the reports of previous studied stating that the acquisition of knowledge-based resources is associated with negative announcement returns to the acquiring firm.

Originality/value

The paper presents new procedures to measure knowledge, collecting data on R&D employees by using annual reports. In addition, the paper suggests adding “in-process R&D” as an “Acquired Knowledge” measure.

Citation

Calipha, R., Brock, D.M., Rosenfeld, A. and Dvir, D. (2018), "Acquired, transferred and integrated knowledge: a study of M&A knowledge performance", Journal of Strategy and Management, Vol. 11 No. 3, pp. 282-305. https://doi.org/10.1108/JSMA-07-2017-0049