The value from acquiring and divesting a joint venture: A real options approach

• 成果类型: Article
• 署名作者: Kumar, MVS
• 署名单位: City University of New York (CUNY) System; Baruch College (CUNY)
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.499
• 发表日期: 2005
• 页码: 321-331
• 关键词: joint ventures; Real options; termination; event study; acquisitions; Divestitures

摘要

This study examines the value created from acquiring and divesting a joint venture. Unlike previous research which focuses on parent firm factors, the study examines value in light of the reason behind the termination of the venture and the characteristics of the target market. Consistent with the real options view, the paper finds that ventures divested to refocus a parent firm's product market portfolio were associated with significant value creation. In contrast, ventures acquired with the objective of growth and expansion in a target market, while not associated with significant value creation, did not destroy value either. Apart from these results, the paper also finds that acquirers and divesters gained lesser value when they terminated ventures in uncertain and concentrated industries. These latter findings highlight an important caveat with regard to termination: joint ventures confer valuable flexibility which is also forgone once they are terminated. Implications are discussed. Copyright (c) 2005 John Wiley & Sons, Ltd.