ABSTRACT

Why do companies engage in acquisitions? Research frequently discusses mergers and acquisitions (henceforth, acquisitions) as a means to reach new markets and to develop new products and competences (Kaul 2012; Trautwein 1990; Walter and Barney 1990). Alternatively, acquisition motives include managers trying to gain personal or career-related benefits (Gomez-Mejia and Wiseman 1997; Grinstein and Hribar 2004). These motives indicate that acquisition research largely takes a company-centric perspective (cf. Kelly et al. 2003) focused on planning or risk taking (e.g. Chaffee 1985; Mintzberg 1973). Meanwhile, adaptation motives focus on environmental reasons for an acquisition (cf. Haleblian et al. 2009) that includes a company’s context in making decisions. This suggests a need to consider acquisitions as a strategic tool to respond to and adjust to changes in a company’s network, where adaptation refers to how a company’s strategy reconciles its ambition with contextual changes (Mintzberg 1973; Ronchi 1980). A network refers to groups of companies directly or indirectly connected by means of business arrangements (Anderson et al. 1994). The network approach constitutes a theoretical point of view that describes company interconnections as an influence on individual company decisions and outcomes (Ford and Håkansson 2006; Håkansson 1982). In focusing on acquisitions as an adaptation strategy that considers a company’s network, the chapter seeks to explain how one acquisition follows after another, or how acquisitions respond to change. Advantages of applying a network approach include explaining mutual adaptation and the spread of acquisitions to additional parties (Hallén et al. 1991; Havila and Salmi 2000).