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Study - USA - Trucking Mergers and Acquisitions in Canada and the U.S. Since NAFTA
N.Y.,USA -blackenterprise -2005-09-03: -- This article investigates the motivations for a sample of Canadian and U.S. trucking company, through a review of press releases picked up by the wire services at the time of announcement, and through an in-depth examination of filings at the time of the M&As. The authors conclude that existing typologies, used to explain M&A activity in other sectors, cannot be usefully applied to the transport sector and so a new typology is proposed. Six case studies are presented to provide support for the proposed typology and, as a secondary issue, to explore the success/ failure profile of M&As in the trucking industry...
BACKGROUND ON THE INDUSTRY
The interstate trucking industry in the U.S. was deregulated in 1980, while in Canada interprovincial trucking deregulation came much later through the Motor Vehicle Transport Act, 1987. Following deregulation, the industry in both countries began a period of restructuring that continues today. During this time, the impacts of deregulation were well studied (e.g., Grimm et al. 1989; Klein et al. 1996; Boyer 1993; and Zingales 1998). Economic regulation of the trucking industry in Canada and the U.S. over half a century often took the form of entry restriction (Bonsor 1995; Viscusi et al. 1996), thereby protecting firms from competition. Such protection, not surprisingly, reduced incentives for the firms in this industry to introduce new technologies or to enhance services. Corsi and Stowers (1991) noted that the U.S. industry became much more strategic in its response post-deregulation, no longer depending on the protection of regulation for its well-being...
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