Determinants of Growth through Mergers and Acquisitions: Empirical Results from Belgium

This paper empirically investigates the determinants of growth through mergers and acquisitions (M&As) in a typical Continental European country, Belgium. By analyzing firm characteristics, industry and aggregate market variables, we are able to determine what motives are important in the decision to acquire. Our results show that intangible capital and firm size significantly positively affect the M&A decision whereas ownership concentration and bank loans have a negative impact. Furthermore, M&As are significantly more likely in industries where incumbents are operating at a relatively low scale, that are less concentrated, and that were recently deregulated.