A Combined Cascade Model to explain industrial consolidation: Theory and an application to steel

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Expansion through mergers and acquisitions (M&As) continues to be a
viable international strategy utilised by industrial firms. A striking feature
of this is that global giant firms lead the M&A wave and generate an
unimaginable impact on relatively small and weak firms across sectors
and even nations. There seems to be a kind of ‘cascade effect’ between the
industrial consolidations in these areas. A combined cascade model developed
in this paper explains that, the power imbalance caused by the
degree of consolidation of the players within a firm’s value system determines
the movement and direction of the ‘cascade effect’. With the
existence of such effect, M&A will be a mutually interdependent, dynamic,
reversible and endless process among industries.
Original languageEnglish
Pages (from-to)255
Number of pages281
JournalInternational Finance Review
Publication statusPublished - 2007


  • Merger and acquisition, combined cascade model, steel industry, China

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