Selection to Value Creation in Bolt-On Acquisitions: A Multi-Stage Configurational Framework

Abstract

Despite decades of scholarly attention, mergers and acquisitions (M&A) continue to exhibit persistently high failure rates, with empirical estimates suggesting that approximately 60% of transactions fail to meet their stated objectives. While prior research has investigated strategic relatedness, integration processes, and organizational fit as independent determinants of M&A performance, the field lacks an integrative, process-oriented framework that connects pre-deal selection decisions to post-integration value creation — particularly in the context of bolt-on acquisitions, where knowledge-intensive, innovation-driven targets are acquired to augment the acquirer's existing capability portfolio. In this paper, the author summarizes the key contributors to M&A outcomes and develops a conceptual model that explains M&A performance as a dynamic capability development process rather than as the outcome of a discrete transaction. The author argues that bolt-on acquisition value creation is not a direct function of strategic selection decisions, but rather the outcome of a multi-stage process in which pre-deal information quality, organizational fit, integration configuration, and governance mechanisms jointly determine whether anticipated synergies are realized. The paper concludes by outlining an empirical research agenda.