Who acquires whom? The role of geographical proximity and industrial relatedness in Dutch domestic M&As between 2002 and 2008
AbstractIn economic geography, geographical proximity has been identified as a key driver of M&A activity. In this context, little attention has yet been drawn to the effect of industrial relatedness, which refers to the similarity and complementarity of business activities. We examine 1,855 domestic M&A deals announced between 2002 and 2008 in the Netherlands, and we assess the extent to which geographical proximity and industrial relatedness affect M&A partnering. Our study shows that geographical proximity drives domestic M&A deals, even at very detailed spatial scales like the municipality level. We also found evidence that companies that share the same or complementary industries are more likely to engage in an M&A deal. Logistic regressions show that the effect of industrial relatedness is stronger than the effect of geographical proximity.
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Bibliographic InfoPaper provided by Utrecht University, Section of Economic Geography in its series Papers in Evolutionary Economic Geography (PEEG) with number 1319.
Length: 40 pages
Date of creation: Oct 2013
Date of revision: Oct 2013
mergers and acquisitions; Netherlands; geographical proximity; home bias; industrial relatedness;
Find related papers by JEL classification:
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-10-25 (All new papers)
- NEP-COM-2013-10-25 (Industrial Competition)
- NEP-CSE-2013-10-25 (Economics of Strategic Management)
- NEP-GEO-2013-10-25 (Economic Geography)
- NEP-URE-2013-10-25 (Urban & Real Estate Economics)
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