By Kathrin Tiecke
2001, p. 691)...
6.2 Concluding Remarks
...In the final part I introduce the strand of financial literature that bargains with the method of mergers less than doubtful potency earnings. by means of introducing doubtful synergies to Cournot merger versions the merger paradox may be solved in all above offered techniques and in comparison to the deterministic types there's a wider scope of ecocnomic mergers. The informational asymmetry after the merger merits the merger participants even though potency earnings can be now not acquired submit merger. hence mergers usually tend to be helpful in comparison to the case the place doubtful potency earnings should not assumed. it's been proven that the incentives to merger coincide with the measure of uncertainty and whilst businesses are conscious of this uncertainty they may be able to arrange for the post-merger integration
process far better considering that post-merger activities could be distinct extra thoroughly. Any merger with doubtful synergies that should be licensed through festival enterprises can definitely have an effect on the approval by way of comparing the doubtful potency profits with the necessary post-merger process...
...this can be an try and reflect the merger disasters within the genuine international. to research extra the function of doubtful synergies, versions that go away from the one-shut nature may be applied. this could provide insights why merger formations seem wavelike and if the equilibrium alterations whilst non-merged companies alter as quickly as
they notice the genuine form of their (new) rival. because the international has develop into realistically extra obvious the unmerged agencies may perhaps notice particularly speedy whether or not they face a kind of effective rival and so the time horizon may still ex ante regulate the anticipated earnings of the industry gamers in comparison to the one-shot nature of the traditional Cournot game.
The query what varieties of corporations, the main or the least effective ones are focused on a merger is still unanswered as there are ambiguous ends up in the speculation of endogenous merger formation. The empirical observations additionally don't help the speculation that low-performing businesses are the popular goal for acquisitions.