Do competition authorities consider business relationships?
Author
Summary, in English
Abstract in Undetermined
Purpose: Companies engage in business relationships for a variety of reasons, including specialization, product development, and building competitive networks. Research has demonstrated that mergers and acquisitions (M&As) may challenge ongoing business relationships. The purpose of this article is to investigate whether and how competition authorities consider business relationships when evaluating M&As.
Methodology: The article uses the documentation from 450 M&As reported to the Swedish competition authority to capture the way in which an authority evaluates M&As. The Swedish competition authority evaluation corresponds to other national and international evaluation procedures.
Findings: The findings indicate that the competition authorities neglect an important aspect of business life, namely companies forming business relationships. The competition authorities evaluate M&As on the basis of risk for price increases, and consequently disregard such issues as heterogeneity in demand and offerings, and values built into existing business relationships.
Originality/Value/Contribution: The article contributes to research on business relationships through exploring how a public authority deals with such relationships. It also contributes to research on mergers and acquisitions through examining how these activities are evaluated by competition authorities. Furthermore, the article contributes to competition research by reflecting on competition law concerning M&A regulations in relation to business relationships.
Purpose: Companies engage in business relationships for a variety of reasons, including specialization, product development, and building competitive networks. Research has demonstrated that mergers and acquisitions (M&As) may challenge ongoing business relationships. The purpose of this article is to investigate whether and how competition authorities consider business relationships when evaluating M&As.
Methodology: The article uses the documentation from 450 M&As reported to the Swedish competition authority to capture the way in which an authority evaluates M&As. The Swedish competition authority evaluation corresponds to other national and international evaluation procedures.
Findings: The findings indicate that the competition authorities neglect an important aspect of business life, namely companies forming business relationships. The competition authorities evaluate M&As on the basis of risk for price increases, and consequently disregard such issues as heterogeneity in demand and offerings, and values built into existing business relationships.
Originality/Value/Contribution: The article contributes to research on business relationships through exploring how a public authority deals with such relationships. It also contributes to research on mergers and acquisitions through examining how these activities are evaluated by competition authorities. Furthermore, the article contributes to competition research by reflecting on competition law concerning M&A regulations in relation to business relationships.
Department/s
Publishing year
2012
Language
English
Pages
67-92
Publication/Series
Journal of Business-to-Business Marketing
Volume
19
Issue
1
Document type
Journal article
Publisher
Taylor & Francis
Topic
- Business Administration
Keywords
- competition authority
- merger
- acquisition
- customer relationship
- supplier relationship
- business relationship
- business marketing
- industrial marketing
Status
Published
ISBN/ISSN/Other
- ISSN: 1547-0628