The Impacts of M&As on R&D investments

Working Papers 232 Lehto Eero

This study considers the impact of M&As on a firm’s R&D investments. We have analysed the impacts of the incidences in which a firm becomes a target and, on the other hand, an acquirer. M&As are classified in our study as being either domestic or cross-border. In addition, domestic M&As are classified – if needed – according to geographical and technological proximity. The results obtained show that M&As tend to increase acquirers’ R&D investments, and decrease targets’ R&D investments or keep them unchanged. The clearest positive effect is related to the incidence in which a Finnish firm buys a foreign firm. On the other hand, when a foreign firm buys a Finnish firm, the impact is zero.

Keywords: M&As, R&D investments
Published : 1.9.2007
JEL: G34, O32
ISBN: 978-952-209-045-4
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