Culture-performance relationships in mergers and acquisition: the role of trust. (1st January 2012)

• Record Type: Journal Article
• Authors: Weber, Yaakov; Drori, Israel; Tarba, Shlomo Y.
• Is Part Of: European journal of cross-cultural competence and management. Volume 2:Number 3/4(2012)
• Page Start: 252
• Page End: 274
• Publication Date: 2012-01-01
• Subjects: mergers and acquisitions -- M&As -- trust -- post-merger integration -- performance; Cross-cultural studies -- Periodicals; Intercultural communication -- Periodicals; Corporate culture -- Periodicals; 303.482
• Languages: English
• ISSNs: 1758-1508

Abstract

This paper presents a theoretical framework for investigating mergers and acquisitions (M&As) performance through an interdisciplinary, multi-stage, and multi-level approach. Trust and human resource challenges during the integration process following a merger are explored to help explain the inconsistencies among empirical findings about the effects of cultural differences on M&A performance. It is proposed that in addition to culture clash, trust has a direct effect on acquired firm's management attitudes and behaviours, thereby influencing post-merger success. We also elaborate on how trust acts to moderate the effects of culture clash in M&As, thus elucidating contradictory findings in the literature.