LAPSE:2023.28603
Published Article
LAPSE:2023.28603
Evaluation of Synergies in the Context of European Multi-Business Utilities
Jens Fuhrmann, Reinhard Madlener
April 12, 2023
In this paper, we evaluate selected multi-business utilities in the European energy market with regard to synergy potentials. To this end, we survey the development of the energy market in Europe and the performance of integrated versus focused utilities regarding their capital market performance measured by their corporate surplus (or deficit). The analysis is restricted to true business integration, in contrast to horizontal or vertical cooperation among separate firms. The German utility company RWE is analyzed in more detail. We find that, over the last 10−15 years, most of the multi-business utilities investigated underperformed compared to more focused utilities, and that they were even below the STOXX Europe 600 utilities index. Furthermore, synergy potentials need to be evaluated continuously, especially when influencing factors, with the potential to act as “game changers”, are either emerging on the horizon or are already present. We conclude that operating an integrated business model is not necessarily outdated in today’s energy markets, and offers a number of advantages.
Keywords
corporate value, E.ON, electric utility industry, market regulation, multi-business firm, multiple business models, operational synergies, RWE
Suggested Citation
Fuhrmann J, Madlener R. Evaluation of Synergies in the Context of European Multi-Business Utilities. (2023). LAPSE:2023.28603
Author Affiliations
Fuhrmann J: RWTH Aachen University, Templergraben 55, 52056 Aachen, Germany
Madlener R: Institute for Future Energy Consumer Needs and Behavior (FCN), E.ON Energy Research Center/School of Business and Economics, RWTH Aachen University, Mathieustraße 10, 52074 Aachen, Germany; Department of Industrial Economics and Technology Management, No [ORCID]
Journal Name
Energies
Volume
13
Issue
24
Article Number
E6676
Year
2020
Publication Date
2020-12-17
ISSN
1996-1073
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Original Submission
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PII: en13246676, Publication Type: Journal Article
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https://doi.org/10.3390/en13246676
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Apr 12, 2023
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