Effects of M&As on innovation performance: empirical evidence from Chinese listed manufacturing enterprises

With the acceleration of the economic globalisation process, worldwide market competition is becoming increasingly intense. To remain impregnable in face of fierce competition, Merger and Acquisition (M&A) become the important means to obtain technology, gain core competitiveness, and increase market share. Therefore, studying the effects of M&As on innovation performance has a certain practical significance. With a sample of 96 M&A events of Chinese listed manufacturing enterprises from 2004 to 2011, we find that horizontal M&A and conglomerate M&A can reduce innovation performance, while vertical M&A has no significant effect thereon. Technological M&A has a positive effect on the innovation performance of the acquiring firm, while the effect of non-technological M&A thereon is negative. In technological M&As, entered technological M&A will lower innovation performance, complementary technological M&A can increase innovation performance, while upgraded technological M&A has no significant effect on innovation performance.