When ownership changes, their banks change too: How acquisitions reshape corporate bank relationships in Europe

Corporate acquisitions trigger not only changes in firms’ ownership and strategy but also a reorganization of their bank relationships. Using a novel dataset linking firm ownership and firm-bank relationships across 23 European countries over 2008–2014, this study finds that majority-control acquisitions lead firms to expand and restructure their set of banks. These changes reflect acquirers’ efforts to overcome informational frictions, particularly when they lack familiarity with the target’s local market or industry. Acquirers tend to add banks with deeper local or sectoral expertise and to drop foreign or less specialized lenders. The results highlight the role of banks as information intermediaries – not just capital providers – and show how firm-bank matching depends on informational needs.