Purpose \u2013 The purpose of this paper is to investigate the combined effect of Mergers and Acquisitions (M&A) partners\u2019 technological relatedness and the acquirer\u2019s effective utilization of the target\u2019s knowledge on explorative and exploitative invention performance post-M&A. Design/methodology/approach \u2013 Based on the knowledge perspective of an M&A, this study measures how much of the target\u2019s knowledge acquired in an M&A has been effectively transformed into new knowledge. A negative binomial regression on a cross-sectional data set of 152 bio-pharmaceutical firms (59 European firms and 93 North American firms) completing at least one M&A in the period between 2001 and 2005 is conducted. The effect of knowledge...