原文Mitigatingrisksincross-borderacquisitionsInthepast20years,thevolumeofcross-borderacquisitionsforcorporateassetshasincreasednearlythreetimesfasterthanthevolumeofdomesticacquisitions.Comparedtodomesticacquisitions,cross-borderacquisitionspresentgreaterchallengesforabuyerbecauseofinstitutionsandculturalvaluesthatareunfamiliartoaforeigncorporation.Firmsacquiringassetsinaforeigncountrymayfacedifferentaccountingpracticesanddisclosurerequirements,whichhampertheduediligenceprocess.Theinternalizationofassetsintothebuyeroperationalstructureisfurthercomplicatedbyculturalpeculiaritiesthatdeterminehowstrategiesareformulatedandbusinessisconducted.Acquiringfirmsmayalsoencounterlegalsystemswithdifferentprotectionofpropertyrights,afactorthataddsuncertaintytofuturecashflows.Thegreaterlevelofuncertaintyincross-borderacquisitionsreducesthevalueoftheassetsbeingexchanged(Akerlof1970;Stiglitz,2000)andappearsasanexplanationtothepoorperformanceofacquirersincross-borderacquisitions(Denisetal.,2002;MoellerandSchlingemann,2005).Inthisarticle,Iwillanalyzedifferentalternativesinwhichbuyerscanamelioratetherisksinherentinthesetransactions.Thisanalysisisimportantforunderstandingtheoptimalentrystrategiesforfirmsthatwanttoexpandtheiroperationsinforeignmarkets.Acquiringfirmscanreduceinvestmentuncertaintybystructuringthepaymentssotheyarecontingentonperformanceoftheassets.Thispaperanalyzestwoalternativecontingentpayments.First,buyerscanpaywithstock,sharingtheriskoftheacquisitionwiththesellersastheywillretainanequitypositionintheacquirer.Second,acquiringfirmscanuseearnoutpaymentscontingentontheperformanceoftheassetsbeingacquired(KohersandAng,2000).Buyersandsellerscanoperateassetstogetherinanequityjointventure(JV)toimprovetheexchangeofinformationonthequalityoftheassets.NandaandWilliamson(1995)describeseveralJVsthatwereconceivedasamechanismtoexchangeinformationconducivetoaneventualacquisition.InasampleofpredominantlydomesticJVs,ManteconandChatfield(2007)findthatJVscanbemechanismstotransferassetsinthepresenceofvaluationuncertainty.Thepurposeofthisarticleistounderstandwhichofthesemechanismsforreducinguncertaintyismorebeneficialtoacquirersofcross-bordercorporateassets.IhypothesizethattheuseofearnoutsandstockasamethodofpaymentandtheformationofequityJVsconducivetoacquisitionsshouldbemorevaluablewheninvestmentuncertaintyismoresevere.Thisarticlecontributestotheexistingliteraturebytestingthishypothesisinasampleof30,783acquisitionsannouncedfrom1985to2005.Thissampleinvolvedbuyersfrom75nationsengagedin6824crossborder-acquisitionsofassetslocatedin128countries.Theresultsshowthatthevaluationeffectstoacquirersincross-borderdealsdependontheinformationobtainedabouttheassetsbeforetheacquisition.BuyersexperiencedlargegainsintheacquisitionofassetsthatwereoperatedinaJV,suggestingthatacquirersprofitedfromtheinformationobtainedwhilejointlyoperatingtheassets.Ihypothesizethatthesegainsshouldbepositivelyassociatedwiththedegreeofuncertaintybeingresolved.Consistentwiththishypothesis,acquirersexperiencedlargergainsintheacquisitionsofJVslocatedincountrieswithhigherlevelsofinvestmentriskandinthepresenceofhigherlevelsofvaluationuncertainty.TheseresultssuggestthatJVscanbeusedasatransitionalmechanismtoreducetheuncertaintyassociatedwithcross-borderacquisitionsinthepresenceofseverevaluationuncertaintiesandcountryinvestmentrisks.Mechanismstoa...
