Privatization, especially in developing countries, presents international ®rms with opportunities for market entry and growth, but acquirers have to consider the distinct characteristics of a state owned enterprise (SOE) and the in¯uence of the government as seller and policy maker. This study introduces a model, based on mergers and acquisitions literature and microeconomic theory, that explains the critical relationships among characteristics of the SOE, the government, and the acquirer. Public administration research suggests that the critical characteristics of SOEs are their sources of funding and their mode of social control of the organization, and recent work in privatizing countries emphasizes the in¯uence of the government. The theoretical framework for the model suggested here is derived from research within the ®eld of strategic management on mergers and acquisitions. The paper develops propositions regarding the organizational ®t between private ®rms and those heretofore owned by governments and discusses research and managerial implications.
The privatization of State Owned Enterprises (SOE) has significant implications for SOE stakeholders. However, the effects on stakeholders will vary depending on characteristics of the privatization process and the structure of the SOE. This paper identifies privatization process characteristics of wealth creation and wealth distribution, and describes SOE structures on a continuum between government corporation and government agency. The privatization effectiveness for stakeholders is discussed and examples provided for each classification of privatization.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.