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Post Merger Performance of Agricultural Cooperatives

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  • Richards, Timothy J.
  • Manfredo, Mark R.

Abstract

Agricultural cooperatives are participating in mergers, acquisitions, strategic alliances, and joint ventures at a record pace. While post-post merger performance has been examined extensively for investor owned firms, this has not been the case for agricultural cooperatives since these firms do not have an explicit profit motive nor publicly traded stock. Results from a three-stage econometric model reveal that a major motivation for cooperatives to engage in these activities is to circumvent unique capital constraints, thus resulting in improved profitability. Furthermore, the decision to merge and financial performance are jointly endogenous, with profitability positively influenced and sales growth negatively influenced by the likelihood of merger.

Suggested Citation

  • Richards, Timothy J. & Manfredo, Mark R., 2001. "Post Merger Performance of Agricultural Cooperatives," 2001 Annual meeting, August 5-8, Chicago, IL 20531, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea01:20531
    DOI: 10.22004/ag.econ.20531
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    Cited by:

    1. Evans, Lewis & Meade, Richard, 2005. "The Role and Significance of Cooperatives in New Zealand Agriculture, A Comparative Institutional Analysis," Working Paper Series 18942, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    2. Maurice Doyon, 2002. "An Overview of the Evolution of Agricultural Cooperatives in Québec," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 50(4), pages 497-509, December.
    3. Evans, Lewis & Meade, Richard, 2005. "The Role and Significance of Cooperatives in New Zealand Agriculture, A Comparative Institutional Analysis," Working Paper Series 3847, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    4. Gabriel J. Power & Victoria Salin & John L. Park, 2012. "Strategic options associated with cooperative members' equity," Agricultural Finance Review, Emerald Group Publishing, vol. 72(1), pages 48-67, March.
    5. Russell, Levi A. & Briggeman, Brian C. & Featherstone, Allen M., 2013. "Debt and Input Misallocation in Farm Supply and Marketing Cooperatives: A DEA Approach," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150445, Agricultural and Applied Economics Association.
    6. Zeuli, Kimberly A. & Howard, Elizabeth & Gould, Brian W. & Cropp, Robert A., 2003. "The Future Viability of the Federated Structure," 2003 Annual Meeting, October 29 31805, NCERA-194 Research on Cooperatives.
    7. repec:vuw:vuwscr:18942 is not listed on IDEAS

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