Innovative mergers and acquisitions and the broker regions of Eur

Innovative mergers and acquisitions and the broker regions of European integration

Balazs Lengyel (ANET-lab, Hungarian Academy of Sciences)

Mergers and acquisitions (M&A) that involve distant acquiring and target companies transfer control and diffuse knowledge across space, which facilitates the integration of business systems. We analyse 40 thousand completed cross-regional acquisitions in EU and EFTA countries between 2003 and 2017 and distinguish innovative and non-innovative M&A. Both types of deals cluster into communities constituted by countries or groups of neighbouring countries. However, an increasing proportion of deals connect different communities, especially for innovative M&A. More populous and richer regions host more acquiring and target companies and thus broker communities. R&D expenditure and skilled human capital are additional factors favouring brokerage of regions by attracting acquirers.

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