The entry mode choice of EU leading companies (1987-1997)

Giampaolo Vitali

CERIS Working Paper from CNR-IRCrES Research Institute on Sustainable Economic Growth - Torino (TO) ITALY - former Institute for Economic Research on Firms and Growth - Moncalieri (TO) ITALY

Abstract: The aim of the paper is to provide empirical evidence on the relationship between industrial structure and M&A process. We focus on the determining factors fostering a firm to choose controlling acquisitions or non-controlling ones. We use the Acquisitions and Divestments Database (ADD), a data-base collecting equity operations made by top-90 EU leaders in the period 1987-1997. A logit analysis shows some variables that increase the probability that the firm’s entry mode choice is a non-controlling-acquisition: firm’s size, firm’s diversification strategy, industry concentration, oligopolistic competition. On the contrary, the R&D differentiated industries and the role of the stock exchange market enforce the probability that the firm’s entry mode is a controlling acquisition.

JEL-codes: F23 L10 L20 (search for similar items in EconPapers)
Pages: 28 pages Keywords : Industrial structure; European industry, M&As; acquisitions; joint-ventures
Date: 1999-12
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Persistent link: https://EconPapers.repec.org/RePEc:csc:cerisp:199910

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