State-Owned Enterprises: Rationales for Merges and Acquisitions

The paper contributes to the empirical literature on M&A deals performed by SOEs with a detailed analysis of the reported rationales from a sample of SOE-led acquisitions over the last decade. The sample includes 355 worldwide M&A deals performed by SOEs as acquirers over the period 2002-2012. The data set was obtained by combining firm-level information from two sources, Zephyr and Orbis (Bureau Van Dijk). The analysis is on a case-by-case basis for the rationales of the sample. Overall, the most important message arising from our analysis is that rescue of firms in financial distress is a relatively minor one role played by contemporary SOEs in spite of the Great Recession, while shareholder value maximization and long term strategic goals are more frequently the objective of the observed deals.

[1]  D. Vandone,et al.  State-owned banks in the market for corporate control , 2019 .

[2]  C. Fiorio,et al.  The targets of state capitalism: evidence from M&A deals , 2017 .

[3]  É. Voszka.  Nationalization or Privatization? The Fragmentation of the Mainstream , 2017 .

[4]  M. Florio,et al.  Governments in the market for corporate control: Evidence from M&A deals involving state-owned enterprises , 2017 .

[5]  K. S. Reddy,et al.  Country-specific determinants of cross-border mergers and acquisitions: A comprehensive review and future research directions , 2017 .

[6]  G. Karolyi,et al.  State capitalism's global reach: Evidence from foreign acquisitions by state-owned companies , 2017 .

[7]  K. S. Reddy,et al.  Cross-border acquisitions by state-owned and private enterprises: A perspective from emerging economies , 2016 .

[8]  C. D. Del Bo,et al.  Institutions and Firms' Productivity: Evidence from Electricity Distribution in the EU , 2016 .

[9]  M. Hitt,et al.  The Renaissance of State‐Owned Multinationals , 2016 .

[10]  X. Freixas,et al.  Public Development Banks and Credit Market Imperfections , 2016, Journal of Money, Credit and Banking.

[11]  C. D. Del Bo,et al.  Public Enterprises in the Market for Corporate Control: Recent Worldwide Evidence , 2015 .

[12]  Gabriel Obermann,et al.  SERVING THE GENERAL INTEREST WITH PUBLIC ENTERPRISES – NEW FORMS OF GOVERNANCE AND TRENDS IN OWNERSHIP , 2015 .

[13]  Marie-Soleil Tremblay,et al.  Corporate governance and accountability of state-owned enterprises: Relevance for science and society and interdisciplinary research perspectives , 2015 .

[14]  Mike W. Peng,et al.  Mergers and acquisitions in and out of emerging economies , 2015 .

[15]  William L. Megginson,et al.  The Sovereign Wealth Fund Discount: Evidence from Public Equity Investments , 2015 .

[16]  Garry D. Bruton,et al.  State-owned Enterprises Around the WORLD as Hybrid Organizations , 2015 .

[17]  Ruth V. Aguilera,et al.  New Varieties of State Capitalism: Strategic and Governance Implications , 2015 .

[18]  Mariana Mazzucato,et al.  Beyond market failures: the market creating and shaping roles of state investment banks , 2014 .

[19]  Yunhee Kim,et al.  State-Invested Enterprises in the Global Marketplace: Implications for a Level Playing Field , 2014 .

[20]  M. Florio.  Contemporary public enterprises: innovation, accountability, governance , 2014 .

[21]  Andrew C. Inkpen,et al.  Governments as owners: State-owned multinational companies , 2014, Journal of International Business Studies.

[22]  S. Lazzarini,et al.  Reinventing State Capitalism: Leviathan in Business, Brazil and Beyond , 2014 .

[23]  A. Maffioli,et al.  Public Development Banks: Toward a New Paradigm? , 2013 .

[24]  Bruno Monteiro.  Determinants of Cross-Border Mergers and Acquisitions , 2013 .

[25]  José de Luna-Martinez,et al.  Global Survey of Development Banks , 2012 .

[26]  R. Millward.  Public Enterprise in the Modern Western World: An Historical Analysis , 2011 .

[27]  Jianjun Miao,et al.  The Dynamics of Mergers and Acquisitions in Oligopolistic Industries , 2011 .

[28]  H. Rudolph,et al.  Development Banks: Role and Mechanisms to Increase Their Efficiency , 2011 .

[29]  Michael N. Young,et al.  Cross-border mergers and acquisitions by Chinese listed companies: A principal–principal perspective , 2010 .

[30]  Philip Molyneux,et al.  Mergers and Acquisitions of Financial Institutions: A Review of the Post-2000 Literature , 2009 .

[31]  M. Wang,et al.  What Drives Economic Growth? The Case of Cross-Border M&A and Greenfield FDI Activities , 2009 .

[32]  Antonin Aviat,et al.  Cross-Border Mergers and Acquisitions and European Integration , 2009 .

[33]  Holger Breinlich.  Trade liberalization and industrial restructuring through mergers and acquisitions , 2008 .

[34]  Arturo Bris,et al.  Adopting Better Corporate Governance: Evidence from Cross-Border Mergers , 2008 .

[35]  A. Micco,et al.  A Reappraisal of State-Owned Banks , 2007 .

[36]  George G. Pennacchi,et al.  Harming Depositors and Helping Borrowers: The Disparate Impact of Bank Consolidation , 2007 .

[37]  Miguel A. Ferreira,et al.  Shareholders at the Gate? Institutional Investors and Cross-Border Mergers and Acquisitions , 2007 .

[38]  Rosalie L. Tung,et al.  International expansion of emerging market enterprises: A springboard perspective , 2007 .

[39]  S. Craig,et al.  The impact of bank consolidation on small business credit availability , 2007 .

[40]  R. Vander Vennet,et al.  Microeconomic Determinants of Acquisitions of Eastern European Banks by Western European Banks , 2006 .

[41]  V. Aivazian,et al.  Can corporatization improve the performance of state-owned enterprises even without privatization? , 2005 .

[42]  J. Harford.  What drives merger waves , 2005 .

[43]  R. Veugelers,et al.  The impact of M&A on the R&D process: An empirical analysis of the role of technological- and market-relatedness , 2005 .

[44]  S. Viswanathan,et al.  Market Valuation and Merger Waves , 2004 .

[45]  Lucia Piscitello,et al.  Corporate diversification, coherence and economic performance , 2004 .

[46]  Mara Faccio,et al.  Politically Connected Firms , 2004 .

[47]  B. Lévesque.  Fonction De Base Et Nouveau Rôle Des Pouvoirs Publics: Vers Un Nouveau Paradigme De L’état , 2003 .

[48]  Kenneth A. Carow,et al.  How Have Borrowers Fared in Banking Megamergers? , 2003 .

[49]  Stefano Rossi,et al.  Cross-Country Determinants of Mergers and Acquisitions , 2003 .

[50]  Richard Bozec,et al.  The impact of the corporatization process on the financial performance of Canadian state‐owned enterprises , 2003 .

[51]  David J. Denis,et al.  Global Diversification, Industrial Diversification, and Firm Value , 2001 .

[52]  Christopher M. James,et al.  Where do merger gains come from? Bank mergers from the perspective of insiders and outsiders , 2001 .

[53]  Vojislav Maksimovic,et al.  The Market for Corporate Assets: Who Engages in Mergers and Asset Sales and are There Efficiency Gains? , 2000 .

[54]  Erik Stafford,et al.  Investigating the Economic Role of Mergers , 1999 .

[55]  M. C. Jensen,et al.  Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers , 1999 .

[56]  M. Mitchell,et al.  The impact of industry shocks on takeover and restructuring activity , 1996 .

[57]  J. Jaffe,et al.  Does Section 16b deter insider trading by target managers , 1995 .

[58]  John G. Matsusaka,et al.  Takeover Motives During the Conglomerate Merger Wave , 1993 .

[59]  Kenneth J. Martin,et al.  Corporate Performance, Corporate Takeovers, and Management Turnover , 1991 .

[60]  Katherine Schipper,et al.  Mergers, Restructuring and Corporate Control , 1990 .

[61]  H. Manne,et al.  Mergers and the Market for Corporate Control , 1965, Journal of Political Economy.

[62]  H. B. Mann,et al.  On a Test of Whether one of Two Random Variables is Stochastically Larger than the Other , 1947 .

[63]  Changqi Wu,et al.  Determinants of Cross-Border Merger & Acquisition Performance of Chinese Enterprises☆ , 2010 .

[64]  S. Globerman,et al.  THE INTERNATIONAL ACTIVITIES AND IMPACTS OF STATE-OWNED ENTERPRISES* , 2009 .

[65]  J. Kay.  The economics of business strategy , 2003 .

[66]  ii ABSTRACT , 2001 .

[67]  Y. Amihud,et al.  Risk Reduction as a Managerial Motive for Conglomerate Mergers , 1981 .