Competence: A Dynamic Extension of the Existing Typology of Acquisition Motives

What is the reason for acquisitions? Till now, strategies related to the daily operations of the firm like increased sale, reduced cost or managerial ambitions have been the prevalent motive. However, a new dynamic motive, the competence explanation is emerging. The purpose of this paper is to develop the existing typology on acquisition motives with a combined approach of competence, resource -based and network theories. The new motive of acquisitions is to acquire firms that posses core competencies. The main purpose of the acquisition is to transfer and utilize unique knowledge from the new subsidiary in the multinational corporation.