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Quantifying the Coordinated Effects of Partial Horizontal Acquisitions

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  • Brito, Duarte
  • Ribeiro, Ricardo
  • Vasconcelos, Helder

Abstract

The growth of private-equity investment strategies in which firms often hold partial ownership interests in competing firms has led competition agencies to take an increased interest in assessing the competitive effects of partial horizontal acquisitions. We propose a methodology to evaluate the coordinated effects of such acquisitions in differentiated products industries. The acquisitions may be direct and indirect, and may or not correspond to control. The methodology, that nests full mergers, evaluates the impact on the range of discount factors for which coordination can be sustained. We provide an empirical application to several acquisitions in the wet shaving industry.

Suggested Citation

  • Brito, Duarte & Ribeiro, Ricardo & Vasconcelos, Helder, 2013. "Quantifying the Coordinated Effects of Partial Horizontal Acquisitions," CEPR Discussion Papers 9536, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:9536
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    Citations

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    Cited by:

    1. Duarte Brito & António Osório & Ricardo Ribeiro & Hélder Vasconcelos, 2015. "Unilateral Effects Screens for Partial Horizontal Acquisitions: The Generalized HHI and GUPPI," Working Papers de Economia (Economics Working Papers) 02, Católica Porto Business School, Universidade Católica Portuguesa.
    2. Martin C. Schmalz, 2018. "Common-Ownership Concentration and Corporate Conduct," CESifo Working Paper Series 6908, CESifo Group Munich.
    3. Brito, Duarte & Ribeiro, Ricardo & Vasconcelos, Helder, 2013. "Measuring Unilateral Effects in Partial Acquisitions," CEPR Discussion Papers 9354, C.E.P.R. Discussion Papers.
    4. Ivaldi, Marc & Lagos, Vicente, 2016. "Assessment of Post-merger Coordinated Effects: Characterization by Simulations," CEPR Discussion Papers 11218, C.E.P.R. Discussion Papers.
    5. repec:eee:indorg:v:53:y:2017:i:c:p:267-305 is not listed on IDEAS
    6. Ivaldi, Marc & Lagos, Vicente, 2018. "How Accurate is the Coordinate Price Pressure Index to Predict Mergers’ Coordinated Effects?," TSE Working Papers 18-915, Toulouse School of Economics (TSE).
    7. Brito, Duarte & Ribeiro, Ricardo & Vasconcelos, Helder, 2014. "Measuring unilateral effects in partial horizontal acquisitions," International Journal of Industrial Organization, Elsevier, vol. 33(C), pages 22-36.

    More about this item

    Keywords

    Antitrust; Coordinated Effects; Demand Estimation; Differentiated Products; Oligopoly; Partial Acquisitions;

    JEL classification:

    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco

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