Influence of Degree of Integration on Post-Acquisition Business Performance at Coca Cola Beverages Africa, Kenya

Abstract

Acquisitions have become a popular business strategy for organizations that seek to grow, enhance efficiency, or manage competition. Many studies have examined the effect of acquisitions on business performance but are often inconsiderate of actual acquisition elements such as degree of integration. In addition, most of the studies have a biased focus on financial and petroleum industry while ignoring the beverage manufacturing sub sector. It is in this regard that the current study sought to examine the influence of degree of integration on post-acquisition business performance with a specific focus on Coca Cola Beverages Africa (CCBA), Kenya. The study was guided by the Haspeslagh and Jemison model, Cording, Christmann and King Model of Integration, and the balanced score card model. It used the descriptive survey design. The target population was CCBA, Kenya with 1094 employees. Data was collected from a sample of 92 staffs of Coca Cola Beverages Africa, Kenya using structured questionnaire. Data was analysed using descriptive statistics and the simple linear regression method and results presented using tables. Results showed that CCBA, Kenya had a high level of business performance with a score of 73% in the post-acquisition period with the highest performance score being recorded in the financial perspective with a score of 75.2%. Findings also showed that degree of integration (score= 75.6%, r²=.482, β=.618, p=.001) had a statistically significant and positive influence on business performance at CCBA, Kenya. Based on the findings, the study concluded that degree of integration has a significant and positive influence on business performance. The study recommends that the management at CCBA, Kenya should focus on promoting the integration of the production function to improve business performance.