Mergers and Acquisitions in Practice

12Acquisition in the Banking Sector in the Transition Process to the Market Economy

Ruth Alas, Tiit Elenurm, Tiiu Allikmäe, and Riina Varts

Introduction

Globalization of businesses has intensified cross-border mergers and acquisitions. More than decade ago mergers and acquisitions became the dominant mode of growth (Adler, 1997). East European transition economies were exposed to cross-border acquisitions after the collapse of the command economy. The financial sector was one of the fields of radical change as in the Soviet command economy there was no role for commercial banking. During the first years of the economic transition many new commercial banks were created but when commercial banking became more mature, concentration processes in ...