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Myriam Cloodt and John Hagedoorn 28.1 INTRODUCTION Over more than 30 years the performance of mergers and acquisitions (M&As) has been a topic of interest to researchers in a number of sub-disciplines within economics and business administration. This is no surprise as we have witnessed an enormous increase in the total number of M&As during the past decades. Even though M&As are widespread and a popular vehicle for firm growth, practice shows that most M&As fail to meet expectations. Various publications estimate failure rates of between 60 to 80 percent (see amongst others Puranam et al., 2003). The explanation for this high failure rate in contrast with the popularity of M&As is still very much in need of both theoretical and empirical research. Although already much attention has been paid to the performance effects of M&As, research so far remains inconclusive and provides somewhat of a mixture of results, to say the least (King et al., 2004). For that reason we will focus our attention on the variation in M&A performance research and attempt to enhance our understanding of post-M&A economic performance and post-M&A innovative performance. The latter will be particularly comprehensively addressed since M&As are nowadays very prevalent in high-tech sectors and innovation has become an important motive for companies to undertake M&As (Prabhu et al., 2005; Cloodt et al., 2006). This chapter is organized as follows. First, we present and explain the historical importance and magnitude of...
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