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| Author: | Ragozzino, R. |
| Title: | The effects of geographic distance on the foreign acquisition activity of U.S. firms |
| Journal: | Management International Review
2009 : VOL. 49:4, p. 509-535 |
| Index terms: | political risks |
| Freeterms: | cross-border acquisitions entry mode cultural distance governance |
| Language: | eng |
| Abstract: | Cross-border mergers and acquisitions undertaken by U.S. companies are examined to determine whether geographic distance directly affects the firms' governance decisions. The results suggest that U.S. firms tend to acquire higher stakes in geographically close targets than in remote ones. The moderating effect of geographic distance on cultural distance and political risk is also investigated. It is found that as these two hazards increase, acquirers prefer shared ownership for proximate deals and full ownership for acquisitions of geographically distinct targets. |
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