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The performance of acquisitions in a small open

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the performance of acquisitions in a small open economy. From the perspective of alocal firm that is to be sold, the key questions are whether and how an acquirer willrestructure the company, and how this will contribute to the acquired company’scompetitive advantage.Choosing the right partner is critical. However, even if an acquirer chooses wisely itmay still reduce performance by integrating the two companies together too roughly.Industry observers have therefore identified post-acquisition integration as beingcritical to long-term acquisition success (Gruca, Deepika, Mehra, 1997; Very et al.1997; Norburn, Schoenberg, 1994; De Noble, Gustafson, Hegert, 1988). Some otherscholars (Čater, Pučko, 2010) in a study on a sample of 172 Slovenian companiesreveal that managers in Slovenia mostly rely on planning and organising activitieswhen implementing strategies, while the biggest obstacle to strategy execution ispoor leadership. Hambrick and Hanella (1993) added to the understanding of theintegration process by emphasising that an acquired company’s executives are placedin a new social setting in which comparisons with their acquirers as well as with theirprior situation are inevitable. They may feel a loss of autonomy, alienation from theirnew partner group, inferior in status and unappreciated by the acquiring company’stop managers. These feelings may bring serious consequences: on one hand, somevaluable executives of the acquired company may leave the company, while, on theother, those who choose to stay may reduce their commitment to the job. Scholarsargue that management of the buying firm should pay at least as much attention tothe human side of the acquisition as they generally give to the strategic side whenplanning and managing the acquisition, acting as partners with the acquired company’smanagers rather than as ‘conquerors’ (Ashkenas et al., 1998). They found that theremoval of autonomy had an indirect effect on a merger’s performance by virtue ofits interaction with perceptions of cultural compatibility. Autonomy removal impliesa high degree of post-acquisition interaction between the merging firms. Specialimportance is assigned to the cultural clash between merging companies, especiallyin cases of cross-border acquisitions (Thomson, 1996; Norburn, Schoenberg, 1994).Cultural differences can have positive or negative impacts on the acquisition’sperformance, depending on how favourably the acquired company’s executives viewthe buying firm’s values and ways of conducting business (Very et al., 1997).3. MethodologyThe person or a company which acquires a share in a joint stock company’s votingstock in Slovenia so that this stock, together with other existing securities in itsportfolio, ensures it a voting right of no less than 25%, has to submit a public take-over bid to acquire these securities. Prior to submitting the take-over bid, the bidder
Matej Lahovnik, Vladimir Malenković • Corporate acquisition strategies and economic...40Zb. rad. Ekon. fak. Rij. • 2011 • vol. 29 • sv. 1 • 33-50shall announce his intention of submitting a take-over bid to the Securities and

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Matej Lahovnik, Vladimir Malenkovi

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