Are mergers and acquisitions contagious?

Abstract

In traditional literature on mergers and acquisitions (M&As), the reasons to merge or acquire are largely described as strategies of the merging or acquiring parties. This article suggests that M&As are contextually driven. Based on six case studies, the article pinpoints how M&As among customers lead to M&As among suppliers, and vice versa. The article launches the concept of parallel M&As to describe this phenomenon, and asks the following question: in what ways are M&As among customers and suppliers a driving force for M&As by the other party? Matching, dependence and keeping a power balance are found as key explanations for parallel M&As.