Has the Development of the EU Changed the M&A Landscape in Europe?

Abstract

This paper raises the question of whether regional integration has increased the volume and improved the efficiency of the market for cross-border mergers and acquisitions. More precisely, using the European Union as the backdrop for our investigation, we examine whether the effects of country-level barriers to cross-border M&A have weakened as integration has developed, thereby creating a more fluid market for corporate resources. Overall, the results do not show convincing support for this idea, revealing that despite on-going integration efforts in the region, M&A activity still suffers from country-specific challenges. A number of implications of these findings are discussed.

Keywords: M&A, regional integration, FDI