The Influence of Cross-Border Acquisitions on Firm Performance: Examining the Moderating Role of International Board Interlocks
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2025-07-01
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en
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Abstract
Cross-border acquisitions represent an essential strategy for firms seeking global expansion and
competitive advantage. Despite their benefits, cross-border acquisitions present challenges,
including cultural and institutional disparities that enhance information asymmetry and
uncertainty. This study investigates the impact of cross-border acquisitions on firm performance
and examines whether international board interlocks moderate this relationship. Using an event
study methodology, 488 acquisition announcements from publicly listed firms between 2010
and 2020 were analysed through regression analysis. The findings reveal that cross-border
acquisitions are associated with significantly lower firm performance compared to domestic
acquisitions, confirming the hypothesis that cross-border acquisitions face greater complexities.
However, the hypothesized positive moderation effect of international board interlocks was not
supported. While interlocked boards provide access to valuable networks and resources, their
effectiveness in mitigating cross-border challenges may depend on additional contextual factors.
This study contributes to prior research on signalling theory by emphasizing the role of signal
alignment with institutional expectations in the cross-border acquisition context. In addition,
this study contributes to impression management theory by highlighting the role of international
board interlocks in shaping stakeholder perceptions and addressing acquisition complexities,
underscoring their potential as strategic tools.
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Faculteit der Managementwetenschappen