MANAGING THE EUROPEAN MERGER

A very different perestroika is currently sweeping through the boardrooms of Europe which will have an impact at least as great as the recent changes in the realpolitik of East‐ West relations. It is the massive industrial reconstruction which is taking place in anticipation of the single European market in 1992. Quietly and with very little publicity companies from every European country have been actively acquiring businesses in all of the EC member states. Between 1985 and 1990 the rate of cross‐border acquiring across Europe has increased five‐fold both in volume and value, with 1989 the first year in which UK companies made more acquisitions in continental Europe than in the USA. Virtually every major European industry — automobiles, banking, chemicals, electronics, food — is in a state of transition, with companies in all of these sectors acquiring and divesting across Europe as they attempt to consolidate their strategic positions. American and Far Eastern competitors are also beginning to line up for a place in a market which many see as having an enormous growth potential.