Cultural Distance and Chinese Cross-Border Merger and Acquisition Performance

Abstract

The researchers examined the relationship between national cultural distance and Chinese cross-border Merger and Acquisition (M&A) performance using an analysis about a sample of 119 cross-border M&A by Chinese firms from 1995 to 2008.They found that the national cultural distance will has an obvious positive effect on the result following the acquisition in the third year. In addition, they also examined the moderating effect from the contextual factors by hierarchical regression analysis and sub-group regression analysis. The results show that in the long run, the cultural differences are associated more positively with post-acquisition performance when the Chinese firms have the previous transnational M&A experience and the deals take place in a related industry.