Business article: M&A as the Portuguese route to Brazil

• Author(s): Carvalho, Ana Filipa Sousa
• Date: 2013
• Persistent ID: http://hdl.handle.net/10362/9809
• Origin: Repositório Institucional da UNL
• Document Type: Master thesis
• Language: English
• Advisor(s): Story, Joana
• Contributor(s): RUN

Description

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

This thesis project is aimed to be a business magazine article to discuss the specific Portuguese route to enter into Brazil of mergers and acquisitions, analyzing the particularities of cultural compatibility. The relevance of this article relies not only on the world’s sixth economy’s potential, which, as a BRIC country, has been facing high expectations of promising growth and opportunities, but particularly on the fact that Portuguese companies have additional incentives to invest there, such as the low levels of cultural distance (Silva, 2005), psychic distance (Sousa; Bradley 2005) and institutional distance. Moreover, M&A has been a focus of many international business articles as an increasingly popular mode of entry (Akgöbek, 2012; Grant Thornton, 2012), especially in countries like Brazil with relatively high challenges in doing business (World Bank, 2012). Taking into account the high failure rate of M&As as well as the specific Portuguese-Brazilian challenge of neglecting preparation by relying on cultural compatibility - psychic distance paradox (Silva, 2012; Cyrino, 2010) - it is crucial to educate Portuguese companies in these internationalization processes. Nevertheless, little literature exists analyzing the strengthened relationship of Portugal and Brazil in a practical perspective of M&A. Therefore, this article provides Portuguese companies with a model for these internationalization processes to Brazil to contribute for the corporate knowledge and future operations’ success. The M&A model (Dowling, Festing, Engle, 2008) was adapted from the knowledge retrieved from companies interviewed for this project, which are present in the market (comprising the environment, ICT, aeronautics and telecommunication sectors) and/or advising those who engage in these operations (including a global law firm and a Portuguese investment bank also present in Brazil).