The Importance of Customers in Mergers and Acquisitions
2008 (English)Doctoral thesis, monograph (Other academic)
The aim of the thesis is to identify categories and patterns of how customers impact and are impacted by an M&A. In M&A (merger and acquisition) research the focus is traditionally on the M&A parties alone, and while customers are important elements of the motives behind M&As, they are rarely seen as actors affecting and being affected by an M&A.
This thesis researches M&As from M&A parties’ and customers’ perspectives. It categorises and connects M&A parties’ activities related to expectations and activities of customers, with customers’ activities at the acquisition point and at integration.
Based on findings from eight M&As, the thesis concludes that customers may be the reasons why companies merge or acquire. Customers may react to the M&A announcement if it involves companies the customers do not want to have relationships with, or based on the fact that customers perceive the M&A as turbulent, for instance. Customer actions, and M&A parties reconsidering their initial intentions, affect integration strategies. The realisation of integration is in turn impacted by customers’ resistance to buy according to M&A parties’ intentions and by customers actively objecting to integration.
In short, customers impact M&As through: (i) being a reason to merge or acquire, where the M&A aims at acquirer’s or acquired party’s customers, or markets/positions, and where the M&A is a responsive activity to customers’ previous activities or is based on expectations on customers; (ii) customer reactions or changed buying behaviour; (iii) M&A parties’ pre-integration reconsideration; and (iv) post-integration difficulties, whereby customers impact integration realisation through not seeing the benefit of the M&A and thereby continue to buy as previously, through objecting to integration or through dissolving relationships.
Customers are impacted by M&As through: (i) the M&A as possibility for change; (ii) ownership changes, which may lead to changes in competition structures; and (iii) forced integration.
This means that the impact that customers have on M&As are both results of their own actions, and also of the expectations that the M&A parties have on customers.
Important findings from this thesis concern adjustments of initial M&A intentions, how integration may be resisted so as not to challenge ongoing relationships, and how customers (often) make it difficult to achieve initial M&A goals and integration as the customers do not act in accordance with the integration intentions of the parties involved in the M&A.
Place, publisher, year, edition, pages
Institutionen för ekonomisk och industriell utveckling , 2008. , 377 p.
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1193Dissertations from the International Graduate School of Management and Industrial Engineering, ISSN 1402-0793 ; 115
Merger, Acquisition, Customer, Customer Relationship, Motive, Integration, Impact
IdentifiersURN: urn:nbn:se:liu:diva-11933ISBN: 978-91-7393-875-4OAI: oai:DiVA.org:liu-11933DiVA: diva2:18335
2008-06-13, C3, Hus C, Campus Valla, Linköpings universitet, Linköping, 10:15 (English)
Sweet, Susanne, Docent
Brege, StaffanHuge Brodin, MariaAndersson, Helén