Roquette Frères buys Sethness, the world's largest caramel colorants producer

Abstract

This paper provides insights into the dynamics of mandate loss and subsidiary charter development through exploring two research questions on what the characteristics of subsidiary mandate loss are and what roles do intra-MNE actors have in subsidiary mandate loss? The paper is based on a qualitative study of 17 cases of subsidiary mandate losses. The data revealed four distinct patterns of mandate loss depending upon what phase of mandate development the subsidiary found itself: (1) mandate loss due to a combination of failure in the new mandate or a change in the external environment. (2) mandate loss due to competition with sister subsidiaries (3) Subsidiaries shed peripheral mandates to create space and focus on the core activities (4) mature mandate loss due to misfit between subsidiary skills and that of competition in the local market. This paper contributes to the subsidiary evolution literature by elucidating the multiplicity of subsidiary mandate loss and the “prime mover” involvement in mandate loss.