Agency theories predict that firms acquire and diversify through acquisitions as they grow older and exhaust their internal growth opportunities, and that they do so for the benefit of managers rather than shareholders. In contrast, we find that acquiring firms are firms with better growth opportunities and performance irrespective of their lifecycle stage. While younger firms acquire more than...

This paper investigates the valuation effects of corporate international diversification by examining cross-border mergers and acquisitions of U.S. acquirers over the period 1990-1999. We find that, on average, acquisitions of “fairly valued” foreign business units do not lead to value discounts. Consistent with the industrial diversification discount literature, unrelated cross-border acquisit...

Traditional approaches to corporate diversification are inadequate for understanding the role of corporation and strategy in the knowledge economy. This paper discusses (1) the need to construe corporate diversification in terms of knowledge-based relatedness and knowledge management capabilities of firms and (2) the role of IT for diversified firms. Knowledge-based relatedness captures related...

The construction industry is the pillar industry in China, accounting for about 6% of the gross domestic product. Along with changes in the external environment of the construction industry in China, the construction firm faces fierce competition. The paper aims to investigate the relationship between diversified types of construction firm and its performance in China. Based on generalist and s...