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Mergers and Acquisitions

The Innovation Impact

Edited by Bruno Cassiman and Massimo G. Colombo

This book examines the issue of mergers and acquisitions (M & As) in the context of technological development, and in particular the impact of M & As on the innovation process. In so doing, the book integrates two bodies of literature, on M & As, and on innovation studies, a nexus which the editors contend represents an important step in the advancement of our understanding of both with clear implications for competitive advantage and growth of firms. Drawing on perspectives from both management and economics, the book offers a cohesive blend of theory, methodology, and a wealth of empirical material.
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Chapter 9: Four Case Studies

Bruno Cassiman, Veerle Minne, Tom Pellens, Geert Steurs and Dafne Reymen


Bruno Cassiman, Veerle Minne, Tom Pellens, Dafne Reymen and Geert Steurs* 9.1 INTRODUCTION This chapter presents four case studies of mergers and acquisitions in the pharmaceutical and chemical industries. The goal of this chapter, and its specific added value, is to closely analyse and convincingly specify some of the mechanisms underlying the theoretical framework – and the empirical results – presented in this book. The four cases presented are: ● ● ● ● the acquisition of Novamax Technologies by Henkel; the merger of vinyl activities of Solvay and BASF into Solvin; the acquisition of Gist-brocades by DSM; and the merger of Pharmacia & Upjohn and Monsanto into the Pharmacia Corporation. By taking an internal perspective of observation, we can gain specific insights on the process of target selection and the firms’ integration as well as their effect on research and development (R&D) performance. These case studies will allow us to better understand the process that explains the effect of Mergers and acquisitions (M&A) on R&D and innovation. The four cases are based in the pharmaceutical and chemical industries. When studying the effect of M&A on R&D and technological innovation, focusing on the pharmaceutical and chemical industries appears appropriate for a series of reasons. First, these sectors have witnessed some of the largest deals of the last decade and have been concentrating over time. While in 1985 the 10 largest pharmaceutical firms accounted for about 20 per cent of worldwide sales, in some 15 years this figure increased...

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