Strategic Networks for Value Creation: Evidence from M&A in the European stainless steel industry

: Degbey William Y., Hassett Melanie E.

: Sarianna Lundan (2013 Conference Chair)

: 2013

: 39th European international Business Academy

Employing a case study method in combination with publicly available information on a stainless steel company based in the European Economic Area (EEA), we illustrate the strategic relevance of networks in shaping the structure and positioning of a focal actor (acquirer and acquired) within the industry for M&A value creation. Using strategic network lens, we point out that while competing actors within the external environment may attempt to derail the intended motive of an M&A agenda, the embeddedness of a focal actor in network of external relationships with other actors may help shape its network position and network structure for superior value creation in its geographic and product markets. In addition, prior business relation between acquirer and acquired firm was found as a strong antecedent for gaining preferred network position with acquired firm customer networks. Further, the dissolution of acquired firm customer networks may impact the acquirer’s ability to reduce its excess capacity within the industry