Simulation Research on M&A Targets, Spin-offs and Interfirms Networks Based on NK Model

To examine the impact of different integration undertaken by firms during M&A integration, we categorize the spin-offs strategic into “additive” and “subtractive” based on network theory. Integrating complex adaptive system theory, we develop an analytical framework that links M&A objectives, integration behaviors, and outcomes. Additionally, we employ an NK model to compare the performance and evolution of interfirms networks for different spin-offs under exploratory and exploitative goals. This study finds that: additive spin-offs increases between centrality, reduces the constraint of the ego network, the average clustering coefficient, and the efficiency of the global network, which renders the ego network more open for explorative goals. Whereas the subtractive spin-offs improves the constraint degree and between centrality of the ego-network, declines the average clustering coefficient and efficiency of the global network, and assembles the ego-network more closed, which is conducive to the realization of the exploitative goal. The higher internal decision complexity makes the advantage of spin-offs behavior more pronounced than that of non-split behavior.