IDEAS home Printed from https://ideas.repec.org/a/pal/jintbs/v16y1985i2p51-64.html
   My bibliography  Save this article

Diversification Strategy and Choice of Country: Diversifying Acquisitions Abroad by U.S. Multinationals, 1978–1980

Author

Listed:
  • Karen B Hisey

    (First Boston Corporation)

  • Richard E Caves

    (Harvard University)

Abstract

What explains the multinational conglomerate, diversified across both product and geographic boundaries? From a sample of diversifying foreign acquisitions by U.S. firms, we conclude that the choice between related and unrelated acquisitions bears little relation to the acquire's base activity in the U.S., but it is somewhat affected by transaction costs and the firm's previous experience in the host country. The motive of risk-spreading encourages unrelated overseas acquisitions.© 1985 JIBS. Journal of International Business Studies (1985) 16, 51–64

Suggested Citation

  • Karen B Hisey & Richard E Caves, 1985. "Diversification Strategy and Choice of Country: Diversifying Acquisitions Abroad by U.S. Multinationals, 1978–1980," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 16(2), pages 51-64, June.
    • Handle: RePEc:pal:jintbs:v:16:y:1985:i:2:p:51-64
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/jibs/journal/v16/n2/pdf/8490450a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: http://www.palgrave-journals.com/jibs/journal/v16/n2/full/8490450a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chandra, Ramdas & Newburry, William, 1997. "A cognitive map of the international business field," International Business Review, Elsevier, vol. 6(4), pages 387-410, August.
    2. Surdu, Irina & Mellahi, Kamel, 2016. "Theoretical foundations of equity based foreign market entry decisions: A review of the literature and recommendations for future research," International Business Review, Elsevier, vol. 25(5), pages 1169-1184.
    3. Witteloostuijn, Adriaan van & Dikova, Desislava, 2005. "Acquisition versus greenfield foreign entry : diversification mode choice in Central and Eastern Europe," Research Report 04G26, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    4. Jo Danbolt, 2004. "Target Company Cross‐border Effects in Acquisitions into the UK," European Financial Management, European Financial Management Association, vol. 10(1), pages 83-108, March.
    5. Boateng, Agyenim & Du, Min & Bi, XiaoGang & Lodorfos, George, 2019. "Cultural distance and value creation of cross-border M&A: The moderating role of acquirer characteristics," International Review of Financial Analysis, Elsevier, vol. 63(C), pages 285-295.
    6. Hitt, Michael A. & Li, Dan & Xu, Kai, 2016. "International strategy: From local to global and beyond," Journal of World Business, Elsevier, vol. 51(1), pages 58-73.
    7. repec:dgr:rugsom:04g26 is not listed on IDEAS
    8. Moshfique Uddin & Agyenim Boateng, 2009. "An analysis of short‐run performance of cross‐border mergers and acquisitions," Review of Accounting and Finance, Emerald Group Publishing Limited, vol. 8(4), pages 431-453, October.
    9. Vasconcellos, Geraldo M. & Kish, Richard J., 1996. "Factors affecting cross-border mergers and acquisitions: The Canada-U.S. experience," Global Finance Journal, Elsevier, vol. 7(2), pages 223-238.
    10. Trevino, Len J. & Daniels, John D., 1995. "FDI theory and foreign direct investment in the United States: a comparison of investors and non-investors," International Business Review, Elsevier, vol. 4(2), pages 177-194, June.
    11. Chen, Chiung-Jung & Yu, Chwo-Ming Joseph, 2012. "Managerial ownership, diversification, and firm performance: Evidence from an emerging market," International Business Review, Elsevier, vol. 21(3), pages 518-534.
    12. Liu, Haiyue & Wang, Yile & Jiang, Jie & Wu, Peng, 2020. "How green is the “Belt and Road Initiative”? – Evidence from Chinese OFDI in the energy sector," Energy Policy, Elsevier, vol. 145(C).
    13. Chung, Chris Changwha & Lee, Seung-Hyun & Beamish, Paul W. & Southam, Colette & Nam, Daeil (Dale), 2013. "Pitting real options theory against risk diversification theory: International diversification and joint ownership control in economic crisis," Journal of World Business, Elsevier, vol. 48(1), pages 122-136.
    14. Lewis, Yimai & Bozos, Konstantinos, 2019. "Mitigating post-acquisition risk: the interplay of cross-border uncertainties," Journal of World Business, Elsevier, vol. 54(5), pages 1-1.
    15. Lyroudi K. & Subeniotis D. & Georgopoulos N., 2002. "Foreign Direct Investment: The Case of Eastern Europe," European Research Studies Journal, European Research Studies Journal, vol. 0(3-4), pages 71-90, July-Dece.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:jintbs:v:16:y:1985:i:2:p:51-64. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.