Acquisitions versus greenfield investments: international strategy and management of entry modes

This paper adds an important explanatory variable to the well‐established list of factors shown to influence the choice between foreign acquisitions and greenfield investments: the international strategy followed by the multinational company (MNC) in question. The MNC's international strategy is subsequently linked to the management of the two different entry modes by showing that differences in strategy are reflected in different headquarters—subsidiary relationships for acquisitions and greenfields. Some aspects of this relationship are also shown to change over time, a process that is mediated by the MNC's strategy. Copyright © 2002 John Wiley & Sons, Ltd.