The sixth wave of mergers and acquisitions. A case study investigating a Hong Kong based company’s investment in Sweden

Abstract

Since the late 1800 companies have performed mergers and acquisitions (M&As) in order to expand their businesses. The characteristics of M&As have altered along with the globalization of our world and the different trends have been divided into five different waves. Recently there has been evidence found supporting a sixth wave, that is, where companies originating from emerging economies acquire or merge with companies in developed economies rather than the opposite. This phenomena and the integration process that they face is what this study aims at investigating and the purpose is to investigate whether the existing M&A literature can be applied to this sixth wave or not. To be able to find answers to the problem statement a single case study was performed on a Hong Kong based company taking over the operation of the Stockholm subway and interviews were conducted at various levels within the company. What was found was that an important contributing factor as to why integration of this kind might be problematic is the lack of comprehension of the different cultures and that the communication between employer and employee is obstructed as a result of this. What can be concluded from this study is that irrespectively of the nationalities of companies taking part of M&As the problems encountered during the integration process are the same, thus, the current M&A literature focusing on Western companies performing M&As on companies in emerging markets is applicable to the sixth wave as well.