Motives for Cross-border Mergers and Acquisitions: Some Evidence from Danish Firms

This study addresses two questions based on Danish firms’ practices: first, what are motives for cross-border mergers and acquisitions (CBM&As)? Second, how the external and internal factors influence the firms’ decisions? According to the results of survey questionnaire and multiple-case study from Danish firms, Synergy Theory, Resource Dependence Theory, and Resource-based View are supported for explaining the motives for CBM&As. Besides, overconfidence and imitation sometimes play a role in the firms’ decision-making process. However, agency problems cannot be identified. It seems, CBM&As are designed to fulfill the firms’ short- or long- term business strategies, as they target smaller private companies. The acquiring firms focus on developing their core businesses rather than pursuing diversification, so related CBM&A are preferred to unrelated ones, and horizontal CBM&As are more prevalent. In addition, we found the nature of the firms’ core businesses mainly determines their motives for conducting CBM&As.