Strategic Business Alliances

Strategic Business Alliances

An Examination of the Core Dimensions

New Horizons in International Business series

Keith W. Glaister, Rumy Husan and Peter J. Buckley

Strategic Business Alliances examines key issues in the analysis, management and performance of international joint ventures using a sample of UK–European equity joint ventures.

Appendix 2: Case vignettes: outlines of the sample IJVs

Keith W. Glaister, Rumy Husan and Peter J. Buckley

Subjects: business and management, strategic management

Extract

IJV 1 UK partner: European partner: Joint venture: European partner nationality: Year of formation: Equity share: Motives of UK partner: Motives of European partner: Industry Aerospace and defence Aerospace and motors Military aircraft Swedish 1995 50:50 Market entry – new market for product Non-market entry – strategic issue to raise volume: sharing of R & D costs, exchange of complementary technology, and to increase competitiveness Satisfied Satisfied Satisfied Industry Aerospace Aerospace Aircraft landing gear France 1995 50:50 Non-market entry: sharing of R & D costs, access to (French) government funding, improving position in market, reducing competition. 185 Performance outcomes: UK partner: European partner: Joint venture: IJV 2 UK partner: European partner: Joint venture: European partner nationality: Year of formation: Equity share: Motives of UK partner: 186 Strategic business alliances Motives of European partner: Non-market entry: sharing of R & D costs, spreading risk of large project, faster payback on investment, reducing competition. JV terminated in 1998 (French partner bought out UK partner’s shares) Poor performance overall – lower returns than expected Very satisfied Satisfied Industry Chemicals production Chemicals production Chemicals services France 1991 50:50 Market entry: faster entry, presence in new markets Market entry: to facilitate international expansion starting in UK JV terminated in 1997 (UK partner bought out European partner’s shares) Satisfied Satisfied Satisfied Industry Defence manufacture Defence manufacture Defence manufacture France 1993 50:50 Market and non-market entry: sharing of R & D costs, faster payback on investment, product diversification, access to new market. Performance outcomes: UK partner: European partner: Joint venture:...

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