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