Investigating the Role of International Business Negotiations in Cross-border M&As in the Banking Sector

Although M&As activity has been increasing in late years, the failure rate of M&As is still very high. Due to the high stakes involved, international business negotiations in this context become vital for a firm's successful performance. The literature has paid little consideration to the negotiation process involved in these transactions. In general, the literature on negotiations is focussed on a few categories of interest and has been considered fragmented and a-theoretical. A well conducted negotiation process could influence the underperformance of a number of M&As, reducing the associated failure rate. This study focuses on how international business negotiations take place in cross-border M&As and how they contribute to the positive outcome of the deal. In particular, the case-study of the Unicredito Italiano's acquisition of Bayerische Hypo-und Vereinsbank (HVB), one of the largest deals in Europe to date, is examined. Based on the case under study, five main areas that should be considered during negotiations in order to ensure a successful outcome have been identified, namely: (1) condition of the negotiation, (2) cultural influences, (3) negotiators 'characteristics, (4) the negotiation situation itself, that is the pre-negotiation and the face-to-face negotiation stages, and (5) the outcome of the negotiation or post-negotiation. [ABSTRACT FROM AUTHOR] Copyright of Economics & Management is the property of Kaunas University of Technology, Faculty of Economics & Management and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)