Acquisition and diversification behaviour in large family firms

Based on a sample of 100 of the largest Italian firms, 38 of which are family firms, we find that being a family firm does not affect acquisition propensity, but that this behaviour is linked to other variables such as being public, more profitable, and larger. This finding differs from prior studies (e.g. Miller et al., 2010), most of which have found that family firms acquire less than non- family firms. Furthermore, we find that family firms are more likely to make acquisitions in non- correlated sectors. Prior research on diversification has reached contradictory results; therefore our study is in line with some prior work (e.g. Ducassy and Prevot, 2010; Miller et al., 2010) but not with other work (Gómez- Mejía et al., 2010).