The financial and operating performance of privatized SME’s in Turkey

Abstract

This paper examines the post privatization performance of privatized companies using a sample of 23 privatization cases in Turkey completed within 1990-2000. Research findings indicate that mergers are resulting in the synergy gains, which is measured by operating cash flows relative to the industries. The cash flow increases do not come from gaining monopoly position and cutting capital investments and labor cost. The cash flow improvements come from the more productive usage of assets in generating sales. The subsample studies show that cash flow improvements are particularly strong in high overlap, equity-financed, value and larger merger subsamples.