Reasons for mergers and economic groups: The Davivienda case - Bansuperior - Bancafé

Abstract

The article studies the motives for mergers. It groups them according to their theoretical roots and shows their usefulness in the case of the merger of Colombian banks Davivienda - Bansuperior - Bancafé. The theoretical frame compiles 17 typologies of motives for merger grouped into three blocks: scale and scope economies, transaction costs and resource based approach. We used the case study method. We obtained data from interviews with Davivienda executives and secondary sources. We used the Likert scale to capture the attitudes of the respondents. We found in the case the majority of motives studied in the literature. One new motive was identified. Particularly one motive for a horizontal merger of Davivienda was the transaction costs economizing by other firms of the economic group to which belongs Davivienda. The specific weight of the transaction costs vertical motives in an essentially horizontal merger deserves further research.