Multinational acquisition integration: the role of national culture in creating synergies

How do cultural differences between home and host nations undermine or enhance multinational acquisitions? Although most believe that differences in national culture affect performance in acquired firms, some studies find cultural differences are problematic, others find they add value to the parent firm, and others find variable or no effects. The study of 103 related acquisitions reported here suggests that the path between national culture and successful integration of an acquisition follows an indirect process. We find that the cultural match or mismatch between the parties to a related acquisition shape their ability to successfully integrate and share resources, which in turn affects the ability to realize synergies.