Recent research indicates that a more measured approach to corporate acquisitions can lead to increased stock values and overall company performance. A study co-authored by Jerayr “John” Haleblian, a professor of management at the University of California – Riverside, reveals that spacing out acquisitions allows companies to better integrate new assets and improve their operational strategies. This finding challenges the conventional wisdom that rapid acquisition is the most profitable strategy.
Published in the Journal of Business Research, the study, titled “Experience Schedules: Unpacking Experience Accumulation and Its Consequences,” examines the impact of timing between acquisitions on company performance. Researchers analyzed over 5,100 acquisitions made by firms in the S&P 1500 from 1992 to 2012. Their findings show that firms that increase the time between acquisitions significantly outperform those that rush into deals with shorter intervals.
Longer Intervals Lead to Greater Success
According to Haleblian, allowing more time between acquisitions helps executives absorb lessons from previous deals. “Our findings suggest that gradually increasing the time between acquisitions can better position firms to learn and improve from each experience,” he noted. This deliberate pacing enables organizations to effectively integrate new employees and assets, reducing the risk of what Haleblian describes as “acquisition indigestion,” where rapid deal-making overwhelms a company’s capacity to integrate new operations.
The research team also conducted interviews with 17 senior executives involved in acquisitions across various sectors, including chemical, energy, and technology. One executive remarked, “If you have fewer deals and more time in between, you can really focus on extracting the value out of that, and it’s less of a strain on the running organization.”
Implications for Acquisition Strategies
The implications of this study are significant for acquisition managers. Rather than pursuing a frantic pace of deals, organizations are encouraged to adopt a more thoughtful approach. This strategy not only helps in maximizing the potential of each acquisition but also fosters organizational stability. The time taken between deals allows leaders to build the necessary structures, rules, and routines that support newly acquired resources.
Haleblian’s research contributes to a growing body of evidence that suggests the importance of experience accumulation in the acquisition process. By extending the intervals between acquisitions, companies can enhance their operational effectiveness and, ultimately, their market valuations.
For businesses eager to improve their acquisition strategies, the message is clear: slowing down may lead to greater long-term success. This study provides a fresh perspective on how companies can navigate the complex landscape of corporate acquisitions for optimal results.
For more information, refer to the study by Christopher B. Bingham and colleagues in the Journal of Business Research, DOI: 10.1016/j.jbusres.2025.115749.
