Internationalization of mid-sized Italian firms through acquisition: the case of Vodafone-Cobra

In recent decades, Italian SMEs have been playing a strategic role in the industrial system, as confirmed either by their performance and the strong orientation toward internationalization, combined with the ability to preserve the specificity and the benefits of their native context. Accordingly, literature analysed the so-called pocket multinational enterprise considering their international focus, the results and the methods that brought them to succeed abroad. However, in recent years, a phenomenon of opposite direction occurs: the passive internationalization of the mid-sized successful enterprises. These “emerging treasures” of Made in Italy completely overturned the prey/predator relationship, becoming attractive for multinational companies. This paper aims at understanding the effects on governance, management and strategy of the acquisition of an Italian mid-sized firm by a foreign multinational, in order to understand whether cross-border acquisitions have positive effects on the target company or not. Methodologically we use the one case analysis. This paper examines the takeover by Vodafone of Cobra Automotive Technologies, a mid-sized firm operating in the field of technologies applied to automotive industry. Findings suggest positive effects for the acquired firm in the early months after the takeover. Cobra immediately gained huge financial resources, a global market reach and a radical change of positioning on international markets. In addition, the British multinational has provided a decisive impulse to the R&D unit that is going to double its dimension within a year.