Horizontal merger analysis

Common Ownership and Mergers between Portfolio Companies

Waterbed Effects and Buyer Mergers

Merger analysis based on standard HHI calculations generally may not fully consider the impact of product durability and hence may significantly bias enforcement efforts. Using an inverse demand equation modified to include a shift parameter linked to the installed base, this paper develops a Durability Adjusted HHI (DAHHI) measure of concentration. DAHHI analysis exposes two potential biases in standard HHI analysis: excessive enforcement in durable goods industries is likely using standard HHI analysis, and Merger Guidelines' thresholds are set too high for non-durable goods industries and too low for durable goods industries. Using the DAHHI methodology, the paper proposes corrections to both biases.

Markets in Merger Analysis

Assessing horizontal mergers under uncertain efficiency gains

This paper addresses the corporate mergers and reorganizations likely to be involved in the further integration of the European Community identified as ‘Europe in 1992’. Speculation on the future is as cheap as it is unreliable. However, the past contains lessons about mergers and international economic integration clearly relevant to the European Community's prospects. The process of international economic integration has been proceeding slowly but steadily throughout the industrial world since the Second World War, as falling relative costs of international transportation, travel and communication have enlarged the internationally traded proportions of tradable-goods outputs and promoted multinational enterprises and transnational corporate alliances and contracts. These trends have been accompanied by changes in the organization of international markets through the expansion of intraindustry and intracorporate trade. They may also be associated with the increase in the 1980s of transnational mergers and acquisitions within international industries. The interpretation of these mergers is the focus of this paper. If the recent wave of international horizontal mergers can be associated with aspects of international economic integration, we can hope to predict merger activity associated with closer integration in the European Community and anticipate any problems for public policy that integration may entail. The economic analysis of horizontal mergers is in an unsettled state, and one goal of this paper is to provide an untraditional explanation. Two classic explanations exist. Mergers between direct rivals can give rise to monopoly rents even if entry is not blockaded. Recent research has, however, emphasized the limitation on capture of this gain because the consolidating firms must contract their outputs. Attainment of scale economies is the other classic goal for mergers.

THE LEADERSHIP of the Antitrust Division of the U.S. Department of Justice has, over the past two years, emphasized that the department's 1984 merger guidelines are a sound prescription for horizontal merger enforcement, that as a matter of policy they are being applied in enforcement decisionmaking, and that there may be a need for and of the guidelines.1 This paper examines some facets of the antitrust analysis of horizontal mergers in the light shed by industrial organization (10) theory, in order to stimulate discussion of some possible directions for fine-tuning and clarification of the guidelines. I focus on the possible anticompetitive effects of horizontal mergers and the role of potential entry in merger analysis. However, to set the context for these subjects, it will be helpful first to sketch the nature of the merger guidelines.

Horizontal mergers, entry, and efficiency defences

Dynamic Efficiency Considerations in EC Merger Control: An Intractable Subject or a Promising Chance for Innovation?

The article examines the features of the use of modern information systems and technologies in the activities of enterprises in order to increase the efficiency of management decisions. Based on a study of modern corporate practices in the global financial market, it is proved that corporate information systems for the management of medium and large enterprises is a necessary tool to minimize costs and increase profitability. The purpose of the article is to research the features of modern information systems and technologies using in activity of the enterprises for the purpose of increase of efficiency of administrative decisions. Information system as a set of organizational and technical means for storing and processing information in order to meet the information needs of users, which provides the collection, retrieval, processing and transmission of information. To solve the existing problems of corporate information systems development, an algorithm of actions to increase the level of informatization and efficiency of corporations, which will address current issues of corporate information systems, taking into account domestic legislation and features of corporate governance, increase efficiency and transparency of business processes and provide centralized support for management decisions. at all levels and in all areas of business companies. It is emphasized that one of the main properties of information systems is divisibility into subsystems, which has scales in terms of its development and operation. The stages of creation and functioning (life cycle) of information are specified. It is proved that the use of information systems is a prerequisite for a modern enterprise, that will promote the adoption of sound strategic management decisions aimed at increasing competition (capacity and strengthening the economic security of the enterprise. An effective area for improvement management of the enterprise is implemented modern information systems and technologic, which makes it possible to increase the speed,quality and reliability of collection, storage and information processing; significantly reduce management line staff of the enterprise, which there is preparation of information for the form management decisions; print in the right time management and administration line staff of the enterprise of high-quality other formation; timely and efficient analysis and forecasting of economic activity under receptions; make decisions quickly and efficiently at all levels of enterprise management.

Artificial intelligence (AI) is seen as a great opportunity to secure future competitiveness in many corporate sectors. Potential for its use also exists in product development (PD) activities due to the amount of data generated and processed. Nevertheless, there are problems in applying the technology. This paper addresses current challenges based on a literature review, considering three disciplines that are necessary for the scope of this paper as a minimum: AI itself, information technology infrastructures (ITI) in context of digital transformation (DT), and PD as an application area. Building on the basic considerations of the state of the art, a link between the domains is established by outlining a possible reference framework towards the utilization of AI applications in PD. This enables an expanded interdisciplinary understanding. Key obstacles appear specifically to be difficult collaboration conditions between the disciplines of PD and AI applications development due to communication problems. Reasons for this include: – Meta models of PD do not provide a sufficient information base– Lack of standardized process models for the deployment of AI

Contracting with Private Information

The Wenchuan Earthquake of 8.0 magnitude at Richter scale hit large region of Sichuan, China on May 12, 2008. It was a terrible disaster that caused great casualties and serious damages, and largely destroyed natural mountainous ecosystems in the earthquake-hit areas. Since the restoration of those damaged mountainous ecosystems plays an important role in ecological security in this region, it is argued that the reconstruction of those earthquake-damaged ecosystems should be given greater attention before and during the ecological recovery process. Yet, to date, little effort has been made to review and summarize the major unresolved questions relating to the ecosystem recovery after the earthquake. Focusing on the priorities for future research in this subject, based on the study and comparison of literatures we identified and examined four important research questions that need to be addressed, even two years after the earthquake. All these questions need to be resolved before significant progress can be made in habilitating the damaged natural ecosystems, and perhaps more importantly, the results provide very useful information for cost-effective restoration decision making and policy planning for the earthquake-hit areas.

Some recent advances and future priorities in research for the meat industry

The paper presents an analysis of some factors affecting the competitiveness of the Russian automotive industry sector. The basic development strategy of the automotive industry in Russia, the main directions of state policy in shaping the domestic car market with foreign partners, foreign investment and innovation. One reason for the low competitiveness of Russian car is problems in engineering education, the low level of funding and setting priorities of research and development activities.