ABSTRACT
This chapter deals with the role of mergers and acquisitions (M&As) in innovation creation. The entry of foreign firms through the route of M&As brings in the horizon of opportunities as well as challenges. Similar to the positive elements of foreign investment, it is expected that the cross-border mergers and acquisitions (CM&As) increase technological spill over to the domestic counterparts through combining the better skill and human resource capabilities of the foreign firms. The competition authorities intend to protect the innovation effort of firms without harming the consumers. In India, as per section 3(5) of the Competition Act, reasonable conditions necessary for protecting any Intellectual Property Rights (IPR) will not attract competition regulations. In the case of Research and Development (R&D) intensity, most of the firms either increased their spending towards R&D after getting into M&As or remained the same without change in their spending.
