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Risk management of strategic alliances and acquisitions between western MNCs and companies in central Europe
Author(s) -
Paik Yongsun
Publication year - 2005
Publication title -
thunderbird international business review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.553
H-Index - 37
eISSN - 1520-6874
pISSN - 1096-4762
DOI - 10.1002/tie.20064
Subject(s) - multinational corporation , business , control (management) , mergers and acquisitions , management control system , industrial organization , strategic management , marketing , international trade , economics , management , finance
This article intends to evaluate risks associated with strategic alliances and acquisitions between Western MNCs and central European companies and to suggest appropriate means of control to deal with two different types of risks: relational and performance. While postsocialistic governments in central Europe have increasingly welcomed foreign direct investments, a relatively high degree of uncertainty still exists for companies contemplating entry into this region due to a lack of cultural knowledge and insufficient business experiences. Based on in‐depth interviews with U.S. and European MNCs, hypotheses are developed in explaining relationship between risks, control, and trust in forming strategic alliances and exercising acquisitions, along with managerial implications. © 2005 Wiley Periodicals, Inc.