Measuring unilateral effects in partial horizontal acquisitions

- We propose a methodology to evaluate the unilateral effects of partial horizontal acquisitions.
- The acquisitions may be direct and indirect, and may or may not correspond to control.
- The methodology simulates the effects on prices, shares, profits and welfare.
- It can deal with differentiated product industries and nest full mergers.
- We provide an empirical application to acquisitions in the wet shaving industry.

Recent years have witnessed an increased interest, by competition agencies, in assessing the competitive effects of partial acquisitions. We propose an empirical structural methodology to examine quantitatively the unilateral impact of partial horizontal acquisitions. The acquisitions may be direct or indirect, and may or may not correspond to control. The proposed methodology simulates the effects on prices, market shares, firm profits and consumer welfare. It can deal with differentiated product industries and nest full mergers as a special case. We provide an empirical application to several acquisitions in the wet shaving industry.