• Alen Sacek University of Latvia
Keywords: due diligence, emerging markets, mergers and acquisitions, risk assessment


Cross-border acquisitions play an important role in the corporate strategic development and international expansion. The paper summarizes the results of the dissertation, which intends to establish vital link between research and practice, deeply exploring the risk assessment methods and the scope of due diligence audit in the pre-acquisition phase. The central hypothesis of the comprehensive model stated that thorough due diligence in the pre-acquisition phase is necessary to make successful cross-border acquisition. The empirical evidence has been drawn on data sample of acquisitions made by automotive firms in cross-border acquisitions in the Central and Eastern Europe. The main results support the proposition that the thorough due diligence audit is necessary pre-requisite for successful acquisition. The findings further support the clear trend: In the past few years, several big automotive leaders strategically gain more control over their supply chains by acquiring technology specialists. From a practical standpoint, the research results provide acquisition management with a simple method of performing the pre-acquisition evaluation of potential acquisition candidates.


Ahammad, M. F., & Glaister, K. W. (2013). The pre-acquisition evaluation of target firms and cross border acquisition performance. International Business Review, 22, 894-904.

Angwin, D. (2001). Mergers and Acquisitiosn across European Borders: National Perspectives on Preacquisition Due Diligence and the Use of Professional Advisers. Journal of World Business, 36(1), 32-57.

Barkema, H. G., & Schijven, M. (2008). How Do Firms Learn to Make Acquisitions? A Review of Past Research and an Agenda for the Future. Journal of Management, 34(3), 594–634.

Bertrand, O., & Betschinger, M.-A. (2012). Performance of domestic and cross-border acquisitions: Empirical evidence from Russian acquirers. Journal of Comparative Economics, 40(3), 413–437.

Bruner, R. F. (2004). Does M&A Pay - A Survey of Evidence for the Decision-Maker. Journal of Applied Finance, 12(1), 48-68.

Carbonara, G., & Caiazza, R. (2009). Factors Affecting M & A Success : A Starting Point for the Topic Renaissance. The Journal of American Academy of Business, 15(Sept), 92–99.

Dunne, P., & Hodgson, A. (2013). M & A Deal Evaluation : Challenging Metrics Myths. London.

Epstein, M. J. (2005). The Determinants and Evaluation of Merger Success. Business Horizons, 48(1), 37–46.

Firstbrook, C. (2007). Transnational Mergers and Acquisitions: How to Beat the Odds of Disaster. Journal of Business Strategy, 28(1), 53–56.

Georgieva, D., Jandik, T., & Lee, W. Y. (2012). The impact of laws, regulations, and culture on cross-border joint ventures. Journal of International Financial Markets, Institutions and Money, 22(4), 774–795.

Gleich, R., Kierans, G., & Hasselbach, T. (2009). Value in Due Diligence. Gower Publishing.

Gomes, E., Angwin, D. N., Weber, Y., & Tarba, S. (2013). Critical Success Factors through the Mergers and Acquisitions Process : Revealing Pre- and Post-M & A Connections for Improved Performance By. Thunderbird International Business Review 2, 55(1), 13–35.

Graham, M., Martey, E., & Yawson, A. (2008). Acquisitions from UK firms into emerging markets. Global Finance Journal, 19(1), 56–71.

Hair, J. F., Ringle, C. M., & Sarstedt, M. (2011). PLS-SEM: Indeed a Silver Bullet. The Journal of Marketing Theory and Practice, 19(2), 139–152.

Harvey, M., Lusch, R. (1995). Expanding the Nature and Scope of Due Diligence. Journal of Business Venturing, 9026(10), 5–21.

Hitt, M. A., King, D., Krishnan, H., Makri, M., Schijven, M., Shimizu, K., & Zhu, H. (2009). Mergers and acquisitions: Overcoming pitfalls, building synergy, and creating value. Business Horizons, 52(6), 523–529.

Hopkins, H. D. (1999). Cross-border Mergers and Acquisitions: Global and Regional Perspectives. Journal of International Management, 5(3), 207–239.

Jemison, D., Sitkin, S. (1986). Corporate Acquisitions : A Process Perspective. Academy of Management, 11(1), 145–163.

Knecht, F., & Calenbuhr, V. (2007). Using capital transaction due diligence to demonstrate CSR assessment in practice. Corporate Governance, 7(4), 423–433.

Perry, J. S., & Herd, T. J. (2004). Mergers and Acquisitions: Reducing M&A risk through improved due diligence. Strategy & Leadership, 32(2), 12–19.

Rossi, S., & Volpin, P. F. (2004). Cross-country determinants of mergers and acquisitions. Journal of Financial Economics, 74(2), 277–304.

Sarstedt, M., & Ringle, C. M. (2011). Multigroup Analysis in Partical Least Squares (PLS) Path Modeling: Alternative Methods and Empirical Results. Measurement and Reasearch Methods in International Marketing, 22, 195–218.

Schildt & Laamanen, T. (2006). Who buys whom: Information environments and organizational boundary spanning through acquisitions. Strategic Organization, 4, 111-133.

Schuler, R., & Jackson, S. (2001). HR Issues and Activities in Mergers and Acquisitions. European Management Journal, 19(3), 239–253.

Schweiger, D.M. & Very, P. (2003). Creating Value through Merger and Acquisition Integration. Advances in Mergers and Acquisitions, 2, 1-26.

Shimizu, K., Hitt, M. A, Vaidyanath, D., & Pisano, V. (2004). Theoretical foundations of cross-border mergers and acquisitions: A review of current research and recommendations for the future. Journal of International Management, 10, 307–353.

Very, P., & Schweiger, D. M. (2001). The Acquisition Process as a Learning Process : Evidence from a Study of Critical Problems and Solutions In Domestic and Cross-Border Philippe Very. Journal of World Business, 36(1), 11–31.