Owned Subsidiaries Research Articles

Shoprite Holdings LtdCase Study: Challenges for Expansion in Africa

This study investigates the obstacles faced by the African expansion efforts of Shoprite Holdings Ltd., a South African retailer. Shoprite pursued mergers and acquisitions within its native country but established wholly owned subsidiaries as its preferred entry route for expanding into other African states. As a result, Shoprite significantly increased its operations by expanding to 16 nations by 2020. However, Shoprite currently focuses its operation in ten countries, exclusively in southern African countries and its home country. This study seeks to comprehend the reasons behind Shoprite's rapid withdrawal from multiple African countries and shed insight into the challenges of conducting business in Africa's demanding business climate. The analysis revealed a combination of economic variables, such as reduced purchasing power of customers, currency volatility, increased operational costs, and the economic shocks caused by the COVID-19 outbreak. Additionally, high customer preference for informal markets and social factors were also identified. The findings indicate that Shoprite should prioritize strategic location selection, adopt a lower entry mode, and consider the potential for developing e-commerce as feasible measures. The report proposes that African retail businesses should comprehend the intricacies of the African market and employ strategies for international expansion, entrance techniques, and the significance of adjusting operations to local conditions and regulatory environments. These discussions offer insights to organizations considering international expansion, seeking to mitigate risks, and aiming to optimize their market entry strategy in various locations, specifically Africa.

Accounting Treatment of the Takeover of the Corporate Bond of the Defunct PTC, Wholly Owned Subsidiary -case Study of Press Corporation Plc

Accounting Treatment of the Takeover of the Corporate Bond of the Defunct PTC, Wholly Owned Subsidiary -case Study of Press Corporation Plc

Narlumosbart: First Approval.

Narlumosbart () is a recombinant, fully human, anti-receptor activator of nuclear factor kappa-Β ligand (RANKL) IgG4 monoclonal antibody being developed by CSPC Pharmaceutical and its wholly owned subsidiary Shanghai Jinmante Biotechnology for the treatment of giant cell tumour of bone (GCTB), bone metastases from solid tumours and osteoporosis. The RANK/RANKL signalling pathway plays a pivotal role in osteoclastogenesis and in the pathogenesis of GCTB. Narlumosbart specifically binds to RANKL and blocks the interaction of RANKL with RANK, thus inhibiting osteoclastogenesis and bone resorption by osteoclasts. In September 2023, narlumosbart received conditional first approval in China for the treatment of adults with GCTB that is unresectable or when surgical resection would result in severe functional disability. Clinical studies of narlumosbart for bone metastases, postmenopausal osteoporosis and glucocorticoid-induced osteoporosis are underway in China. This article summarizes the milestones in the development of narlumosbart leading to this first approval for the treatment of adults with GCTB.

Subsidiary Capital Structure in Multinational Enterprises: A New Internalization Theory Perspective

We study subsidiary capital structure as a mechanism of intra-MNE (multinational enterprise) governance from the perspective of “new internalization theory”. We build on the argument from transaction cost theory that equity and debt are not just financial instruments but also alternative governance structures, with equity useful for financing specific assets that do not serve well as collateral, especially when external uncertainty is high. Inside an MNE, debt represents a partial reintroduction of market mechanisms that can limit governance costs and strengthen subsidiary manager incentives. However, debt financing may be inappropriate if subsidiaries possess specific assets that are lost if debt contracts are enforced. Using subsidiary-level panel data from Norwegian MNEs, we argue that patents registered in the subsidiary represent MNE-specific non-location bound knowledge assets, while subsidiary R&D income represents location-bound and subsidiary-specific assets. We predict MNE-specific assets to be negatively related to external debt, and subsidiary-specific assets to be negatively related to all debt, under conditions of external uncertainty. We find only partial support for our hypotheses. Patents are negatively related to external debt when external uncertainty in the form of political risk is high. However, we do not find similar significant results for location-bound and subsidiary-specific assets, measured by subsidiary R&D income. For both measures, there is evidence that debt financing is viable in low-risk contexts. Further analysis indicates different effects for joint ventures as compared to wholly owned subsidiaries. We build on the partly unexpected results to propose an expanded internalization perspective on subsidiary capital structure.

Configurations of innovation performance in foreign owned subsidiaries: focusing on organizational agility and digitalization

PurposeThe authors investigate conditions that drive innovation performance in foreign-owned subsidiaries. The authors study five variables affecting innovation performance: organizational agility and digital capabilities as the main drivers and competencies and embeddedness in internal and external networks as complementary antecedents of innovation.Design/methodology/approachThe authors draw on the neo-configurational perspective and apply fuzzy set qualitative comparative analysis (fsQCA) to empirically test survey data from subsidiaries located in the emerging economies of Thailand and Vietnam.FindingsWhile the authors find no single condition on its own determining innovation performance, the authors do find that in concert they form four configurations of high innovation performance. The results indicate that all configurations contain competencies, as well as that subsidiaries should prioritize between internal and external networks to complement agility, digital capabilities, to achieve high innovation performance. The authors also reveal intriguing contextual differences in the innovation performance configurations between the two host countries.Originality/valueBy incorporating causal complexity as well as substitutability and complementarity of innovation drivers, the authors extend the current understanding of subsidiary innovation performance outcomes.

Uncertainty, fictional expectations and economic agency

Major periods of regulatory, institutional and economic upheaval can have significant impacts on firms. They have to mediate resulting uncertainties, but where such actions are geographically uneven as firms respond in different ways. Actors construct mental representations of a future reality based on existing understandings of a situation, which seeks to influence and guide other actors, termed ‘fictional expectations’ (Beckert, 2016). These issues are important for foreign owned subsidiaries, since they work through intracorporate processes and politics, global production networks, and host regions. The UK’s decision to leave the EU in June 2016 produced significant uncertainties around the final type of trading agreement. This paper examines how foreign subsidiaries in the Southeast of England and Wales mediated these uncertainties, and why particular fictional expectations were created in relation to the corporate contexts of subsidiaries and the nature of regional ‘coupling’. In conclusion, the paper finds that subsidiaries created fictional expectations to acquire devolved responsibility from HQs for mediating Brexit, and to address uncertainties relating to a potential ‘no deal’ and supplier issues. High value creation subsidiaries have greater autonomy and capabilities that facilitate fictional expectations that are able to acquire responsibility for Brexit mediation, and to undertake more substantive uncertainty reduction measures.

A PHASE 1 PLACEBO-CONTROLLED SINGLE-DOSE STUDY OF NIPOCALIMAB ADMINISTERED AT DIFFERENT RATES OF INTRAVENOUS INFUSION IN HEALTHY ADULTS

Warm autoimmune hemolytic anemia (wAIHA) is a rare, life-threatening disorder characterized by the destruction of red blood cells by pathogenic IgG autoantibodies. There is currently no approved treatment for wAIHA. Nipocalimab is a fully human, aglycosylated, effectorless IgG1 monoclonal antibody that blocks the IgG binding site on the neonatal Fc receptor (FcRn) with high affinity, which is in clinical development for the treatment of wAIHA. In a prior phase 1 study in healthy adults receiving single and multiple ascending doses infused intravenously (IV) over 2 hours, nipocalimab was well-tolerated with an adverse event profile comparable to placebo. However, shorter durations of nipocalimab infusion may be more convenient for patients. Here we assess the safety and tolerability of single doses of nipocalimab administered at different IV infusion rates in healthy adults to support the potential use of shortened infusions in future studies. The trial was a single dose, sequential, randomized, double-blind, placebo-controlled, escalating dose and infusion rate study. Eligible participants were males or females aged 18-55 years with no clinically significant medical or physical conditions. Participants were randomized to 1 of 5 cohorts (n = 8 per cohort [6 nipocalimab, 2 placebo]) to receive nipocalimab 30 mg/kg IV infused over 60, 30, 15 or 7.5 min (0.5, 1, 2, or 4 mg/kg/min), nipocalimab 60 mg/kg IV infused over 15 min (4 mg/kg/min) or matching placebo. Escalation to the next dose level was permitted following review by a safety monitoring committee. Safety was assessed by the frequency and nature of treatment-emergent adverse events (TEAEs). A total of 40 participants (70% female, 93% white) received study drug and were included in the safety analysis; 39 completed the study. A total of 12 participants (40%) experienced TEAEs across all nipocalimab dosing cohorts and 1 (10%) participant experienced TEAEs following administration of placebo. The most frequently reported TEAE was headache, reported by 6 participants with nipocalimab and 1 participant with placebo. Nausea was reported by 3 participants receiving nipocalimab. Grade 2 injection site reactions were reported by 2 participants but were considered unrelated to the investigational agent. None of the TEAEs were severe, and no participants discontinued treatment due to TEAEs; there were no serious adverse events or deaths. Only 4 participants experienced AEs that occurred within 24 hours after the infusion that were considered related to the study drug. Lower rates of nipocalimab infusion were associated with fewer TEAEs, while participants receiving 4 mg/kg/min (as either 30 mg/kg infused over 7.5 min or 60 mg/kg infused over 15 min) reported more TEAEs. Single doses of nipocalimab, when administered at doses up to 60 mg/kg and infusion rates up to 4 mg/kg/min were safe and well-tolerated in healthy adults. The frequency of reported TEAEs was lower in participants receiving IV nipocalimab at rates of 1 or 2 mg/kg/min, providing a target infusion rate for current and future studies. JHL, AV, LEL are employees of Janssen Research & Development, LLC, and AMBP is an employee of Janssen Latin America, which are a wholly owned subsidiaries of Johnson & Johnson, and may own stock or stock options in Johnson & Johnson.

Don't Worry, I Know What I'm Doing: Talent Management Practices between South Korean and Foreign-Owned Firms

It is frequently argued that Talent Management (TM) has been derived from Western, and there are gaps between spread westernized TM format and contexts of non-western countries when TM is adopted and practiced in a business daily basis. The cultural and institutional gaps to adopt TM are analyzed in this paper through comparing the differences in TM practices between foreign owned subsidiaries and local firms in South Korea using an institutional theory lens. A mixed method approach including 55 semi-structured interviews from South Korean and non-South Korean employees and 155 survey responses is employed. This paper results revealed the clear distinctions that indigenous firms practice inclusive and implicit TM, whereas foreign firms practice global standard exclusive TM program South Korean firms are developing very specific approaches within their traditional cultures such as collectivism and Confucianism to manage talent, and also local employees evaluate this tailored TM approach is effective like other foreign MNCs’ exclusive TM approach. Firms experience and respond to the external exigencies in very different ways and tendencies for isomorphism cannot be assumed.

Sličnosti i razlike u praksi upravljanja ljudskim resursima u podružnicama kompanija u stranom vlasništvu u postsovjetskom regionu u poređenju sa državama Centralne i Istočne Evrope

The purpose of this study is to determine interrelations between the characteristics of HRM in local subsidiaries in six focal countries in the light of different organizational variables: year of establishment, sector of MNC, mode of entry and origin of MNCs in selected post-Soviet counties in comparison to Central and Eastern European countries. We profile the HRM practices of almost 234 foreign owned subsidiaries located in Kyrgyzstan, Kazakhstan, Hungary, Russia, Slovakia and Poland. Using descriptive statistics, we present the general characteristics of the sample and then we use bivariate statistical analysis to test our hypotheses relating to the impact of different factors on the HR practice mix implemented in the subsidiaries of MNCs covered in our survey. The results support a contention that multinational companies following different HR management practices/approaches due to institutional histories. For example, in post-Soviet countries, HR departments have more centralized decision-making with tight control and the number of expatriates is lower when compared to the practices of firms in the CEE region.

AN EVALUATION OF IMPACT OF ADVERTISING INTENSITY ON ENTRY MODE CHOICE

Globalization has led companies to expand into foreign markets. These multinational enterprises (MNEs) consider diverse factors when entering a foreign country. One of the important decisions the MNEs make is the entry mode choice. Additionally, advertising intensity can be another important factor that may affect the entry mode choice. Therefore, it is important to make an analysis regarding the effect of advertising intensity on entry mode choice. Accordingly, the aim of this study is to make an evaluation regarding the impact of advertising intensity on entry mode choice. Six articles were chosen that are related to this topic to make a such investigation. The result of the evaluation showed that there are some inconsistent findings in the literature that are discussed in the paper. Apart from the inconsistencies, it can be stated that as the advertising intensity increases, the MNEs may choose wholly owned subsidiary to enter a foreign market.

Jumping Out or Following theRoad Post-Converstion Innovation Behavior of InternationalJointVentures

This study examines the effect of converting international joint ventures (IJV) to either local for foreign wholly owned entities on the subsequent impact of innovation from the perspective of knowledge-based view, complementary asset and knowledge recombination literature. We argue that different knowledge compositions (technological vs. complementary) of post-conversion firms affect the way they integrate learnt knowledge with existing ones and subsequent recombination strategies. Based on longitudinal data in China between 1998 and 2013, we use an instrumental variable (IV) estimation to strengthen identification of causal effects. We find that substantial stock of complementary knowledge of post-conversion local wholly owned subsidiaries (LWOS) promotes subsequent recombinant reuse (i.e., reconfigure combinations already known to the firm), while hinders their recombinant creation (i.e., create combinations new to the firm). In contrast, substantial stock of technological knowledge increases the likelihood that post-conversion foreign wholly owned subsidiary (FWOS) will take a recombinant creation strategy, but decreases the likelihood of taking a recombinant reuse strategy. Contingencies such as knowledge features obtained through IJV and external appropriability regimes are discussed. Our study contributes to the literature on IJV operation mode, knowledge-based view, complementary asset, and knowledge recombination.

Franklin Electric strengthens water treatment portfolio

Franklin Electric Co has bought the US water treatment business New Aqua LLC and its wholly owned subsidiaries, in an all-cash transaction valued at US$150 million.

Huawei in Venezuela: a review of 2006–2019

PurposeThe aim of this article is to describe Huawei's internationalization process in Venezuela and show how socio-political and economic conditions helped to expedite the company's development in this Latin American nation between 2006 and 2019. Through this internationalization process, Huawei participated in a large technological transition in Venezuelan telecommunications.Design/methodology/approachThis research uses an integrative approach, developing a quasi-case study from a review of the academic literature, contemporary news stories and institutional and practitioner documents.FindingsThe review indicates that Huawei was engaged in business with the Venezuelan phone company before its renationalization. Secondly, Huawei's internationalization was a beneficiary of the increased relations between the Venezuelan and Chinese governments, mainly through “oil for loans/goods” agreements. Lastly, this internationalization process includes wholly owned subsidiaries, direct export, greenfield and government joint ventures.Practical implicationsThis research provides an understanding to other firms and strategists about the benefits of strong bilateral economic relationships between home and host countries.Originality/valueThis paper is among the first academic articles that describe the internationalization process of Huawei in Venezuela. Considering the host country's changing political and economic conditions during the last 20 years, such research may provide a perspective for considering other Chinese business expansions in Venezuela and Latin America.

Franklin Electric adds New Aqua to Water Treatment portfolio

Franklin Electric Co has bought the US water treatment business New Aqua LLC and its wholly owned subsidiaries, in a US$150 million deal.

Franklin Electric buys Puronics

Franklin Electric Co Inc has acquired US water treatment company Puronics Inc and its wholly owned subsidiaries, in an all-cash transaction.

Franklin Electric expands in water treatment with Puronics purchase

Franklin Electric Co Inc has acquired US water treatment company Puronics Inc and its wholly owned subsidiaries, in an all-cash transaction.

On the Capital Structure of Foreign Subsidiaries: Evidence from a Panel Data Quantile Regression Model

This paper studies how variations in tax rates and profitability affect the (unconditional) quantiles of the distribution of the leverage of European foreign owned subsidiaries in the presence of unobserved company characteristics, possibly correlated with their observable dimensions. To achieve our goal, we suggest how to apply Firpo et al. (2009) approach to the estimation of unconditional quantile partial effects in a model with correlated random effects. The results show that the impact of taxes and profitability on subsidiaries’ financial choices varies across different quantiles of the (skewed) distribution of leverage. In particular, when the leverage ratio is low enough, an increase in a subsidiary’s tax rate stimulates its borrowing. When however, the leverage ratio is high enough, taxes do not matter. We also find that the parent company’s tax rate has a positive impact on a subsidiary’s leverage ratio only if its starting leverage ratio is low enough. Finally, profitability (proxied by ROA) has either a negative or null impact, depending on the leverage ratio and the tax rate used (namely, statutory or effective marginal tax rates).

A Review of Role of Mobile Based Advisory System for Transfer of Technologies for Sustainable Agricultural Development

Mobile phones have established itself in the rural areas and are becoming quite popular both with farmer and farm women. These powerful electronic machines that were a farmer’s dream earlier have become a reality as the farmer’s can immediately make use of them to address their field problems and other farm difficulties. The Government gifted Kisan Call Centres (KCC) are functioning the all over India which give answers to the farmer queries in local languages to this toll free number 1800-180-1551. Grameen Phone is a commercial operation providing cellular services in both urban and rural areas of India, with approximately 40,000 customers. A pilot programme of Grameen Phone, through the Grameen Bank and a wholly owned subsidiary called Grameen Telecom, is enabling women members of the Grameen Bank’s revolving credit system to retail cellular phone services in rural areas. This instrument is more than a means of communication and it is being used as a weapon for empowerment and fight poverty. Mobile advisory system have been developed and utilized for transfer of agricultural technologies for sustainable development across the world. The findings of the different mobile based studies conducted across the world have reviewed and presented for replicating the suitable models in similar situation for effective dissemination of the technologies. It is concluded that mobile platform is only tool to reach the last mile connectivity especially in rural areas for delivering need based technologies in time.

The Double Irish and Dutch Sandwich strategies and tax avoidance in Mauritius

Purpose The purpose of this paper is to analyze the Double Irish and Dutch Sandwich (DIDS) tax schemes used by international companies. Companies using these schemes are enabled to transfer a large amount of their profits to offshore tax havens by using wholly owned subsidiaries located in Ireland and the Netherlands. This paper also analyzes the US General Anti-Avoidance Rule (GAAR) to see whether it can effectively detect and counteract this scheme. This analysis is furthermore enhanced by applying the Mauritian GAAR through Section 90 of the Income Tax Act to the said schemes. Design/methodology/approach Concerning research methods, the library and the internet will be the main sources of information to be used for this paper. Through the usage of library research, the Mauritian Income Tax Act, US GAAR, European Commission decisions and scholar writings will further enhance this paper on the structure and preventive actions that can be taken against the DIDS scheme. This paper will also use a case study coupled with a theoretical analysis of current anti-avoidance rules. Findings The paper then concludes that it is possible to counteract the schemes using the Mauritian law but under specific circumstances. It is then revealed that there is a fundamental flaw in the current tax systems, which is the inability to regulate the intangible nature of resources and technology-based transactions. Originality/value To the author's knowledge, this paper is among the first literature on the subject of DIDS strategies conducted in the context of Mauritius.

Development of CancerLinQ, a Health Information Learning Platform From Multiple Electronic Health Record Systems to Support Improved Quality of Care.

ASCO, through its wholly owned subsidiary, CancerLinQ LLC, developed CancerLinQ, a learning health system for oncology. A learning health system is important for oncology patients because less than 5% of patients with cancer enroll in clinical trials, leaving evidence gaps for patient populations not enrolled in trials. In addition, clinical trial populations often differ from the overall cancer population with respect to age, race, performance status, and other clinical parameters. Working with subscribing practices, CancerLinQ accepts data from electronic health records and transforms the local representation of a patient's care into a standardized representation on the basis of the Quality Data Model from the National Quality Forum. CancerLinQ provides this information back to the subscribing practice through a series of tools that support quality improvement. CancerLinQ also creates de-identified data sets for secondary research use. As of March 2020, CancerLinQ includes data from 63 organizations across the United States that use nine different electronic health records. The database includes 1,426,015 patients with a primary cancer diagnosis, of which 238,680 have had additional information abstracted from unstructured content. As CancerLinQ continues to onboard subscribing practices, the breadth of potential applications for a learning health care system widen. Future practice-facing tools could include real-world data visualization, recommendations for treatment of patients with actionable genetic variations, and identification of patients who may be eligible for clinical trials. Feeding these insights back into oncology practice ensures that we learn how to treat patients with cancer not just on the basis of the selective experience of the 5% that enroll in clinical trials, but from the real-world experience of the entire spectrum of patients with cancer in the United States.