Mergers and Acquisitions in German Industry

The merging of companies contributes enormously to the dynamics of the corporate landscape and is normally coupled to the business cycle. Since the financial crisis of 2009, however, mergers and acquisitions involving German companies have become uncoupled from the state of the economy. This is particularly surprising due to the prevailing weakness of investment in Germany and may be partly explained by the high prices put on companies. Additionally, in the German economy as a whole there is a perceptible trend towards diversifying by merging with firms in other sectors. By contrast, the data for the most important industries suggest that in recent years companies have preferred to consolidate, with comparatively few mergers with, or acquisitions of, companies outside the sector. In view of this, the hypothesis that manufacturing firms are increasingly acquiring the knowledge necessary for the development and implementation of industry 4.0 applications by merging with, or taking over, IT companies cannot be confirmed. Rather, the IT sector is itself going through a period of consolidation.