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Business & Economics

THE INFLUENCE OF DEAL VALUE'S DETERMINANTS IN MERGERS AND ACQUISITIONS WITH COMMUNITY DIMENSION: SOME EMPIRICAL EVIDENCE FROM THE EUROPEAN UNION
Roxana Manuela Dicu, Constantin Toma, George Marian Aevoae, Daniela Neonila Mardiros

ABSTRACT. Following the adoption of the first European merger and acquisition regulation in 1989 (Council Regulation (EEC) No 4064/89), the European Union has imposed the competition law as one of the main pillars of the acquis communautaire. The transposition of this regulation in 2004 (Council Regulation (EC) No 139/2004) reinforced the position of the European Commission in the analysis of concentrations with a Community dimension between companies, one of which at least operates in one of the 28 countries of the European Union. This paper has two objectives: first, to use ANOVA method to test the differences between the means of the deal values, considering the type of target's economy and the merger waves; second, to analyze how the choice for a target is influenced by certain qualitative characteristics of the concentrations.
To reach our purpose, we start from the scientific literature and continue with the proposed research hypotheses which are to be tested on a sample of 1,531 mergers and acquisitions with community dimension that were completed in the EU between 2005 and 2017. The results will show that there are significant differences between the means of the deal values paid for targets located in developed economies compared to the frontier ones. Also, the odds for choosing a target company are influenced by factors like the geographical position of the acquirer (EU, outside EU or outside Europe), the core activity of the target and the period when the concentration took place. 

KEYWORDS:  mergers and acquisitions, controlling interests, FTSE Russell classification, community dimension, merger waves, EU membership.

JEL classification:  G34, M16, M21.