Ownership in cross-border acquisitions and the role of government support

Pinto, Cláudia Frias; Ferreira, Manuel Portugal; Falaster, Christian; Fleury, Maria Tereza Leme; Fleury, Afonso

http://hdl.handle.net/10400.8/6030

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Authors

Pinto, Cláudia Frias

Ferreira, Manuel Portugal

Falaster, Christian

Fleury, Maria Tereza Leme

Fleury, Afonso

Abstract(s)

We examine the role of government support on the ownership choices by multilatinas in cross-border acquisitions, both directly and in moderating the relationship between institutional distance and knowledge access. We argue that the pro-market reforms and three mechanisms of government support – financing, stock participation, and political ties – can result in higher levels of ownership negotiated by firms, under conditions of greater institutional distance and knowledge access. Our findings contribute to extend the institution-based view by exploring how the unique institutional characteristics of Latin American countries, and especially different types of government support, influence foreign ownership strategies of multilatinas.