The impact of absorptive capacity on post-acquisition financial performance: The European ICT data

Absorptive capacity refers to a firm´s ability to utilize external knowledge for commercial purposes. Ability to capture externally generated information is crucial in contemporary world, where competition is intense and new product lifecycle short - signifying the importance of constant learning and openness. The current study investigates the impact of absorptive capacity on financial performance in the context of corporate acquisitions. A quantitative research was carried out based on European ICT companies that were subject to acquisition in 2008. The results demonstrate that absorptive capacity entails a direct effect on financial performance.