Deck 4: International Mergers and Acquisitions, International Joint Ventures, and Alliances

Question 1

Firms seldom use international mergers and acquisitions to access technology and skilled people.

Answer 1

False

Question 2

Firms with headquarters in different countries and who work together in a partnership can be referred to as international combinations.

Answer 2

True

Question 3

In the merger and acquisition process, an essential element for HR is participating in the 'due diligence' review of the target company to identify information such as management capabilities and any labor problems.

Answer 3

True

Question 4

Non -Equity-based international combinations involve long-term relationships - with one partner buying all or most of the equity in the other partner.

Question 5

Equity international combinations share profits, responsibilities, and resources according to specific contractual relationships - but do not involve one party buying equity in the other party.

Question 6

The actual process of the IM&A combination usually proceeds through four stages.

Question 7

One of the primary reasons for the high failure rate in cross-border acquisitions and IJVs involves the lack of attention before "signing the agreement."

Question 8

As both parties typically state that the merger or acquisition is a combination of equals, in practice, one group always dominates in the acculturation process.

Question 9

The overriding motive in most JVs seems to be the desire by one or all parties to gain knowledge and learn from their partner(s).

Question 10

As with IM&A and IJVs, there is only one way to design an international alliance.

Question 11

Drivers of the growth of international acquisitions include all of the following except

A) the need to grow the business to compete with other global firms.
B) to acquire assets and resources needed to compete.
C) a faster way to develop a presence in the local market.
D) the desire to develop all of the required resources internally.

Question 12

Unlike an acquisition, an international alliance is ongoing and needs to be governed throughout as a ___________.

A) process
B) relationship
C) task
D) none of the above

Question 13

Which of the following is not typically a reason for pursuing an acquisition or international alliance?

A) To enhance industry consolidation.
B) To enable geographic expansion.
C) To form a firm with superior market advantages.
D) To create a niche market.

Question 14

The typical due diligence review of target firms during the pre combination phase ________ considers the critical people, organizational, and HR issues that often provide the reasons for the success or failure of the combination.

A) often
B) sometimes
C) rarely
D) never

Question 15

Which of the following is not an activity HR professional can do as part of a due-diligence process?

A) Creating a SWAT team
B) Creating a checklist of items to evaluate
C) Developing an action plan once the process has started
D) Dealing with concerns about the nature of the new firm

Question 16

IHRM due diligence includes examining concerns, including

A) adequate funding of health care plans.
B) foreign employment regulations.
C) HR department practices, policies, and organization.
D) all of the above.

Question 17

A general resistance to ___________ is a frequently-mentioned cause of integration problems.

A) technology
B) management
C) change
D) all of the above

Question 18

The process of acculturation can result in one of the following:

A) Dissimilation
B) Assumption
C) Revision
D) Assimilation

Question 19

Which of the following is an option for managing international alliances?

A) Service model.
B) Operator model.
C) Flexible model.
D) Owner model.

Question 20

People issues in international alliances include all of the following EXCEPT

A) the need for a clear organizational structure and reporting relationships.
B) the development of cultural awareness.
C) the need to develop succession plans.
D) the need to ignore any previous scandals or negativity about the potential partner.

Question 21

How does an international joint venture differ from an international alliance?

Question 22

International mergers and acquisitions typically follow a process of combination that proceeds through three stages. Identify these stages and explain the role HR should play in each stage.

Question 23

List three HR-related questions that must be answered so that cultural integration after a merger can be managed effectively.

Question 24

Discuss how HR practices such as job design, selection, performance, and compensation have been used to create and sustain successful international joint ventures.

Question 25

Discuss the role of IHRM in international alliances.

Question 26

Explain the role of HRM in facilitating success in international mergers or acquisitions and provide recommendations for HR's involvement in the process.

Question 27

Compare and contrast some reasons why an MNE would choose international expansion through acquisition, an international joint venture, or an alliance. What are the variables that would influence the decision?

Question 28

Explain the General HR issues in international alliances.