La justification de l'essor des conglomérats financiers en Europe

Abstract

The justification of expanding financial conglomerates in Europe The arcticle propose to justify the emergence of conglomerates by insisting on the mutual advantages of managers and shareholders. From this point of view, managers have the role of rendering coherent varying activities which may not necessarily be in synergy in order to secure sufficient profitability for shareholders. Furthemore, such managers whose objectives does not only reside in the maximisation of share values, maximize howerver their presence within the conglomerate (entranchment theory). Our idea is that the conglomerate succeeds in strentgthening the entranchement theory, by giving managers additional debt margins (by intra-group debt) in order to increase the level of leverage of the conglomerate. At the same time, conglomerates, having little equity capital, benefit from the prudential consolidation rules, the double consequence of which being the artificial increase of the capital by simple addition, and the isolation of the manager from shareholder pressure.