Merger in a cold climate

Article Abstract:

The recessionary climate of the early 1990s has brought about changes in the European mergers and acquisition (M&A) scene. The economic downturn has forced European companies to concentrate on increasing market share, while boosting productivity through improved economies of scale. Much of the M&A activity in the 1990s is thus likely to be dictated by the need to restructure conglomerates to help them become more competitive in their core businesses. As a result, divestments of non-core business units and the acquisition of businesses that offer competitive synergies are expected to be the focus of much of the M&A activity in Europe. It is also likely that the hostile takeovers that characterized M&A in the 1980s shall be less popular, with joint venture cooperation replacing it as the preferred mode by which companies could acquire expertise in sectors related to their core businesses.

Mergers, acquisitions and divestments, Acquisitions and mergers, Corporations, European

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Weighing costs and benefits

Article Abstract:

The wave of Japanese manufacturing investment in Europe has created new jobs and resulted in the transfer of advanced Japanese manufacturing know-how to European industry. However, the beneficial effects of Japanese investment has largely been negated by the enforced restructuring of European industries brought about by the efforts of European firms to remain competitive with their Japanese counterparts. The restructuring of the European automobile industry is a case in point. Although investment by Japanese automobile makers has helped create over 11,000 jobs, the restructuring of less efficient European automobile makers has resulted in the loss of over 12,000 jobs with more layoffs expected. Likewise, while Japanese know-how has helped improve manufacturing standards, there is little evidence to show that it has made European automobile companies more competitive.

Motor vehicles and car bodies, Management, Japan, Cover Story, Automobile industry, Corporations, Japanese

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