1987 Fiscal Year Final Research Report Summary
Study on Merger Movement -- The Concentration and Merger of the Industrial Capitals through the Financial Transaction
| Project/Area Number |
60301094
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| Research Category |
Grant-in-Aid for Co-operative Research (A)
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| Allocation Type | Single-year Grants |
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| Research Field |
Public finance/Monetary economics
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| Research Institution | KYUSHU UNIVERSITY |
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Principal Investigator |
FUKAMACHI Ikuya Professor, Faculty of Economics, Kyushu University, 経済学部, 教授 (20037104)
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| Co-Investigator(Kenkyū-buntansha) |
USHIYAMA Masaru Associate Professor, Faculty of Economics, Kyushu University, 経済学部, 助教授 (40108626)
岡橋 英夫 北九大, 商学部, 助教授 (90047712)
岡本 悳也 熊本商大, 経済学部, 教授 (60019271)
大庭 清司 野村総研, 国際開発部, 部長
高須賀 義博 一橋大, 経済研究所, 教授 (70017656)
IKUKAWA Satoshi Associate Professor, Faculty of Economics, Saga University
NOSHITA Yasutoshi Lecturer, Faculty of Politics and Economics, Kokushikan Yniversity
SAKAMOTO Tadashi Professor, Faculty of Commerce, Kumamoto University of Commerce
HARADA Yoshinori Lecturer, Faculty of Economics, Tohoku Gakuin University
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| Project Period (FY) |
1985 – 1987
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| Keywords | Conglomerate / Megamerger / Watering / Capitalization of Corporation itself / Equity Swapping / Cash Tender / TOB / LBO |
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| Research Abstract |
In this study we have the aim to make an analysis on the contemporary features of the conglomerate mergers during the 1960s (the 3rd wave) and the megamergers which have been caused since the mid-1970s (the 4th wave). We have adopted the method to compare historically the today's mergers and aquisitions (M & A) with those which were brought about in the periods of 1895 - 1905 (the 1st wave) and in the later half of the 1920s (the 2nd wave).
The industrial aspect of the preceeding two waves of mergers were of the concentrations among the same industrial sections and (or) the absorption of down-stream businesses which produced some related finished products, in accordance with the expansion of markets, domestic and international. In the financing aspect of these mergers was prevalent "the capitalization of the corporate" -- the capitalization of the expected return of a corporate -- and "the watering" of the shares issued.
In studying the today's M & A, we have made use of the historical and comparative method. Our target was the United States and Germany. The conglomerate mergers of 1960s in the U.S., we could conclude, were brought about between corporates of unrelated industrial sections. On the contrary, the megamergers have occurred in the same and related sections. Regarding the financing process, there was a stark contrast between the two waves. The traditional way of financing merger was "the equity-swapping" which made the cash-saving possible. The conglomerate mergers have followed suit.On the contrary,in the newly-occurred megamergers since the mid-1970s, "the cash tender" has been the overwhelming way of the hostile TOB. We have analysed the macro-economic situation underlying the two merger waves: the change from the economic growth and the tight money market condition into the stagnation and the depressed state of securities market after 1974; the financial innovations, especially the securitization undergoing in this decade.
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