Do Digital Ecosystem Deals Foster Merger Activity?
Abstract
The article estimates how merger and acquisition (M&A) deals by Russia’s largest digital ecosystems – VK, Sber, Yandex, MTS and T-Bank – affect subsequent M&A activity in the sector between 2001 and 2025. We use a dataset of 10,415 deals, treating a sector-month as “treatment” once at least one digital ecosystem deal occurs. The empirical strategy has two complementary stages. First, a two-way fixed-effects model uncovers statistical links: after an ecosystem deal, the number of deals rises while their average price falls. Second, a dynamic difference-in-differences design with panel matching identifies the causal effect. Matching relies on a three-month pre-treatment history and propensity-score weighting, yielding satisfactory covariate balance. Estimates show that after an ecosystem merger, deal frequency in the sector increases, whereas aggregate deal value remains unchanged. The findings point to a structural shift: major platforms trigger more frequent but less capital-intensive mergers, complicating antitrust scrutiny under the current RUB 7 billion notification threshold. Therefore the new regulation of platforms based on the gatekeeper principle, which is currently being actively discussed, will make it possible to account for such series of small but collectively significant acquisitions.
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