Losses from Horizontal Merger PDF Download

Author: Stephen W. Salant
Publisher:
ISBN:
Category : Consolidation and merger of corporations
Languages : en
Pages : 28

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Author: Jean Jaskold Gabszewicz
Publisher:
ISBN:
Category :
Languages : en
Pages : 7

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Author: Joseph A. Clougherty
Publisher:
ISBN:
Category : Competition
Languages : en
Pages : 46

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Author: Kathrin Tiecke
Publisher: GRIN Verlag
ISBN: 3640928652
Category : Business & Economics
Languages : en
Pages : 89

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Diploma Thesis from the year 2011 in the subject Economics - Micro-economics, grade: 2,0, Humboldt-University of Berlin (Wirtschaftstheorie II), course: VWL - Mikroökonomie, Industrial Organization, language: English, abstract: ...Farell and Shapiro state that there is no necessity for mergers as cooperation and coordination can be achieved at an equivalent level via contracts: “..., modern economic theory observes that virtually anything that can be done with a merger can in principle be done instead with some kind of contract, perhaps a very complex (or restrictive) one.” (Farrell and Shapiro 2001, p. 691)... 6.2 Concluding Remarks ...In the last section I introduce the strand of economic literature that deals with the process of mergers under uncertain efficiency gains. By introducing uncertain synergies to Cournot merger models the merger paradox can be solved in all above presented approaches and compared to the deterministic models there is a wider scope of profitable mergers. The informational asymmetry after the merger benefits the merger members although efficiency gains may be not obtained post merger. Thus mergers are more likely to be beneficial compared to the case where uncertain efficiency gains are not assumed. It has been shown that the incentives to merger coincide with the degree of uncertainty and when firms are aware of this uncertainty they are able to prepare for the post-merger integration process much better since post-merger actions can be specified more accurately. Any merger with uncertain synergies that needs to be approved by competition agencies can positively affect the approval by evaluating the uncertain efficiency gains with the required post-merger process... ...this may be an attempt to replicate the merger failures in the real world. To analyze further the role of uncertain synergies, models that depart from the one-shut nature should be implemented. This might give insights why merger formations appear wavelike and if the equilibrium changes when non-merged firms adjust as soon as they observe the true type of their (new) rival. As the world has become realistically more transparent the unmerged firms may observe rather fast whether they face a more or less efficient rival and so the time horizon should ex ante alter the expected profits of the market players compared to the one-shot nature of the standard Cournot game. The question what types of firms, the most or the least efficient ones are involved in a merger remains unanswered as there are ambiguous results in the theory of endogenous merger formation. The empirical observations also do not support the theory that low-performing firms are the preferred target for acquisitions.

Author:
Publisher:
ISBN:
Category :
Languages : en
Pages : 47

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We study how operating efficiencies in horizontal mergers affect market reactions of merging firms' rivals, customers, and suppliers. We measure operating efficiency gains using projections disclosed by merging firms' insiders. Higher efficiency gains are associated with lower announcement returns to merging firms' rivals (due to increased equilibrium output of merging firms), higher returns to their customers (due to lower equilibrium price of merging firms' output), and higher returns to their suppliers (due to the merged firm's higher equilibrium demand for inputs). Our results suggest that the pass-through of efficiency gains along merging firms' supply chains is as important as the effects of post-merger changes in market power.

Author: Daniel Gore
Publisher: Cambridge University Press
ISBN: 1107007720
Category : Business & Economics
Languages : en
Pages : 559

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Provides a clear, concise and practical overview of the key economic techniques and evidence employed in European merger control.

Author: Queen's University. School of Business. Research Program
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Author: David P. Rutenberg
Publisher: [Kingston, Ont.] : Queen ́s University, School of Business, Research Program
ISBN:
Category :
Languages : en
Pages : 29

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Author: Michael G. Vita
Publisher: DIANE Publishing
ISBN: 1428958452
Category : Hospital mergers
Languages : en
Pages : 48

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Author: C. Edward Fee
Publisher:
ISBN:
Category :
Languages : en
Pages : 52

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Book Description
We investigate the upstream and downstream product-market effects of a large sample of horizontal mergers and acquisitions from 1980-1997. We construct a dataset that identifies the corporate customers, suppliers, and rivals of the firms initiating horizontal mergers and use this dataset to examine announcement-related stock market revaluations and post-merger changes in operating performance. We find little evidence consistent with increased monopolistic collusion. However, we do find evidence consistent with improved productive efficiency and buying power as sources of gains to horizontal mergers. The nature of the buying power gains, i.e., rents from monopsonistic collusion or improved purchasing efficiency, is also investigated.