Culture Clashes in Cross-Border Mergers and Acquisitions Between Firms from Two Distant Cultures: The Case Study of Sweden’s Volvo and Korea’s Samsung

This study investigates the way in which employees from acquiring and acquired firms experience cultural differences during post-acquisition integration. We examined Volvo Construction Equipment’s acquisition of Samsung Heavy Industry’s division of construction equipment. Two ontologically bipolar conceptualizations of culture - the classic and social constructivist concept of culture – are discussed. Semi-structured interviews were conducted at Volvo Construction Equipment Korea twice with 11-year interval in 2001 and 2012 respectively. The results suggest that while the classic concept of culture correctly predicts what kinds of culture-dependent problems may occur during postacquisition integration, the social constructivist concept of culture can better predict whether these problems may occur, or not.