Generic differences between equity international joint ventures (EIJVs), international acquisitions (IAs) and international greenfield investments (IGIs): Implications for parent companies

William Newburry, Yoram Zeira

Research output: Contribution to journalArticlepeer-review

Abstract

This article develops a model which examines the impact of ten generic differences between equity international joint ventures (EIJVs), international acquisitions (IAs) and international greenfield investments (IGIs) in the pre- and post-incorporation phases of these entities. These differences address the topics of age, equity ownership, financial risk, goal conflict, negotiation time frame, number of owners, ownership type, secrecy, speed of results and trust. It is proposed that some of these differences will have a greater affect on EIJVs, some on IAs and some on IGIs. Additionally, some differences will be more significant in the pre-incorporation phase of a business venture, while others will have a greater impact during the post-incorporation phase. Based upon the generic differences, each of the business venture forms has inherent advantages and disadvantages over the other forms. In general, it is suggested that corporations will increase their chances to be more successful by understanding the generic differences between EIJVs, IAs and IGIs and by coping effectively with these differences. The article concludes with some more specific recommendations for improved EIJV, IA and IGI performance in both the pre- and post-incorporation stages.

Original languageEnglish
Pages (from-to)87-102
Number of pages16
JournalJournal of World Business
Volume32
Issue number2
DOIs
StatePublished - 1997

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