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Resource complementarity and value capture in firm acquisitions: the role of intellectual property rights

Grimpe, Christoph LU and Hussinger, Katrin (2014) In Strategic Management Journal 35(12). p.1762-1780
Abstract
Extant literature holds that firm acquisitions create value through innovation if the knowledge bases of the acquirer and the target complement each other. Little is known about the value that patents associated with a target's knowledge convey to the acquirer, i.e., their value in securing market exclusion and freedom to operate in R&D. We argue that such property rights hold preemptive power allowing firms to capture the value from combining complementary technologies and to realize gains from trade in strategic factor markets. Our results for a sample of 1,428 acquisitions indicate that-controlling for technological value-acquired preemptive power is an important determinant of the acquisition price, particularly when the acquirer... (More)
Extant literature holds that firm acquisitions create value through innovation if the knowledge bases of the acquirer and the target complement each other. Little is known about the value that patents associated with a target's knowledge convey to the acquirer, i.e., their value in securing market exclusion and freedom to operate in R&D. We argue that such property rights hold preemptive power allowing firms to capture the value from combining complementary technologies and to realize gains from trade in strategic factor markets. Our results for a sample of 1,428 acquisitions indicate that-controlling for technological value-acquired preemptive power is an important determinant of the acquisition price, particularly when the acquirer is technology intensive and acquired patents are highly related to the acquirer's knowledge base. Copyright (C) 2013 John Wiley & Sons, Ltd. (Less)
Please use this url to cite or link to this publication:
author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
technology acquisitions, intellectual property rights, value creation, value capture, resource complementarity
in
Strategic Management Journal
volume
35
issue
12
pages
1762 - 1780
publisher
John Wiley & Sons
external identifiers
  • wos:000344327400003
  • scopus:84911366461
ISSN
0143-2095
DOI
10.1002/smj.2181
language
English
LU publication?
yes
id
75ea3bd7-271a-42fd-a048-e2fe27ebe354 (old id 4874955)
date added to LUP
2015-01-12 15:07:55
date last changed
2017-10-01 04:06:16
@article{75ea3bd7-271a-42fd-a048-e2fe27ebe354,
  abstract     = {Extant literature holds that firm acquisitions create value through innovation if the knowledge bases of the acquirer and the target complement each other. Little is known about the value that patents associated with a target's knowledge convey to the acquirer, i.e., their value in securing market exclusion and freedom to operate in R&D. We argue that such property rights hold preemptive power allowing firms to capture the value from combining complementary technologies and to realize gains from trade in strategic factor markets. Our results for a sample of 1,428 acquisitions indicate that-controlling for technological value-acquired preemptive power is an important determinant of the acquisition price, particularly when the acquirer is technology intensive and acquired patents are highly related to the acquirer's knowledge base. Copyright (C) 2013 John Wiley & Sons, Ltd.},
  author       = {Grimpe, Christoph and Hussinger, Katrin},
  issn         = {0143-2095},
  keyword      = {technology acquisitions,intellectual property rights,value creation,value capture,resource complementarity},
  language     = {eng},
  number       = {12},
  pages        = {1762--1780},
  publisher    = {John Wiley & Sons},
  series       = {Strategic Management Journal},
  title        = {Resource complementarity and value capture in firm acquisitions: the role of intellectual property rights},
  url          = {http://dx.doi.org/10.1002/smj.2181},
  volume       = {35},
  year         = {2014},
}