Horizontal, Vertical, and Conglomerate FDI: Evidence from Cross Border Acquisitions

Arbeitspapier

By using data on cross-border acquisitions (CBAs), this paper explores the distribution of the strategies pursued when multinational enterprizes integrate a foreign subsidiary into their organisational structure. Based on a measure of vertical relatedness, each of the 165,000 acquisitions in our sample covering 31 source and 58 host countries can be classified as horizontal, vertical, or conglomerate. Three novel features of CBAs are highlighted. First, horizontal and vertical CBAs are relatively stable over time. Second, substantial parts of CBAs involve conglomerate acquisitions. Third, the wave-like growth of CBAs arises primarily from changes in conglomerate activity, which responds to international valuation differences between financial markets.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 14.02

Classification and Topics

• Classification: Wirtschaft ; Economic Integration ; International Investment; Long-term Capital Movements ; Multinational Firms; International Business ; International Monetary Arrangements and Institutions
• Subject: Cross-Border Acquisitions ; Multinational Firm ; Horizontal Merger ; Vertical Merger ; Conglomerate Merger

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Herger, Nils ; McCorriston, Steve
• Event: Veröffentlichung
• (who): Swiss National Bank, Study Center Gerzensee
• (where): Gerzensee
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/128084
• Last update: 10.03.2025, 11:45 AM CET